Reasonable opportunity of hearing is mandatory before a prejudicial revisional order can be made under income-tax law.

Section 33 of the Indian Income-tax Act, 1922 permitted the Commissioner to revise orders, but its proviso barred any prejudicial order unless the assessee was heard or given a reasonable opportunity of being heard. A short notice to reply, without fixing a hearing or allowing the assessee to place material before the Commissioner, did not satisfy that requirement. The assessee's indication that further opportunity was expected before final decision reinforced the procedural defect. The resulting order was therefore invalid for want of fair hearing.

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Issues: Whether the Commissioner could validly pass a prejudicial order under Section 33 of the Indian Income-tax Act, 1922 without giving the assessee a reasonable opportunity of being heard.

Analysis: Section 33 empowered the Commissioner to call for the record, make enquiry, and pass such orders as he thought fit, but the proviso barred any prejudicial order without hearing the assessee or giving a reasonable opportunity of being heard. The notice given afforded only a short time to reply, no appointment was fixed for hearing, and the assessee indicated that he expected a further opportunity before a final decision. The order was nonetheless passed immediately thereafter, without enabling him to place his case or evidence before the Commissioner. The mention of the Hindu undivided family contention did not alter the central defect that the assessee had not been fairly heard before the order was made.

Conclusion: The assessee was not given a reasonable opportunity of being heard, and the order under Section 33 was invalid.

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