Natural justice requires reasons when a modification plea raises a later order affecting an earlier deposit direction.

When a modification application specifically raises a subsequent order affecting the basis of an earlier deposit direction, the Tribunal must consider that contention and record reasons for rejecting it. Reasons are part of natural justice, and the litigant is entitled to know why the grievance was found unacceptable. The High Court found the orders rejecting the modification application and appeal unsustainable and set them aside, restoring the modification application for fresh disposal on merits in accordance with law.

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Issues: Whether the orders dismissing the modification application and the appeal were sustainable when the Tribunal did not deal with the plea that the proceedings against the original assessee had already been dropped and did not record reasons.

Analysis: The earlier direction to deposit the penalty amount could not be faulted because the plea regarding the dropping of proceedings against the original assessee had not been brought to the notice of the authorities at that stage. However, once the miscellaneous application specifically raised that subsequent order and questioned the sustainability of the deposit direction, the Tribunal was required to consider the contention, even briefly, and record reasons for rejecting it. Reasons form part of the principles of natural justice and a litigant is entitled to know why the asserted grievance was found unacceptable.

Conclusion: The orders dated 16.10.2014 and 5.5.2015 were unsustainable and were set aside. The modification application was restored for fresh disposal on merits in accordance with law.

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