Natural justice in tax assessment requires a fair hearing and reasons; ex parte orders may be quashed and remitted.

An ex parte tax assessment passed without adequate opportunity of hearing and without sufficient reasons was vulnerable to interference for breach of natural justice, even though a statutory appeal was available. Because the assessment order did not explain how liability was determined, the consequential appellate order also could not stand. The proceedings were quashed and the matter was remitted for fresh adjudication, with directions to afford proper hearing and allow production of documents and materials while leaving the merits open.

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Issues: Whether the assessment order and the appellate order were liable to be set aside for violation of natural justice and absence of adequate reasons, and whether the matter required fresh adjudication after granting proper hearing.

Analysis: The assessment was passed ex parte without affording sufficient opportunity to represent the case, and the order did not disclose adequate reasons as to how the tax liability was determined. Since the order visited the assessee with civil consequences, interference was warranted despite the availability of a statutory appeal. The appellate order, being consequential, also could not stand.

Conclusion: The assessment order and the appellate order were quashed. The matter was remitted for fresh consideration after granting adequate opportunity of hearing and permitting production of documents and materials.

Final Conclusion: The writ petition succeeded to the extent of setting aside the impugned proceedings and directing fresh adjudication, while leaving the merits open for determination by the assessing authority.

Ratio Decidendi: An ex parte tax assessment made without adequate hearing and without sufficient reasons is vulnerable to judicial interference for breach of natural justice, and the proper course is fresh adjudication after affording a fair opportunity.

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