Ex parte tax assessment and bank attachment quashed where timely cancellation request was left undecided for years.

Where a statutory application for cancellation of an ex parte tax assessment is filed within limitation, the authority must decide it within a reasonable time; prolonged inaction for years is unjustified. Because the cancellation request remained undecided, the ex parte assessment could not be treated as finally concluded. The resulting bank attachment, being consequential to that assessment, also could not survive. The ex parte assessment orders and bank attachment were quashed, and the assessee was to receive a fresh hearing before reassessment.

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Issues: Whether ex parte assessment orders and consequential bank attachment were liable to be set aside where the assessee had timely invoked the statutory remedy for cancellation of the assessment and the authority failed to decide that application for an inordinate period.

Analysis: The assessee had filed the application for cancellation within the prescribed period under the statutory scheme. The assessment was therefore not treated as finally concluded, and the authority was bound to decide the application either way within a reasonable time. Prolonged inaction for years, without any effective adjudication of the cancellation request, was held to be unjustified. Once the ex parte assessment itself was set aside, the attachment of the bank accounts, being consequential, could not survive.

Conclusion: The ex parte assessment orders and the consequential bank attachment were quashed, and the assessee was to be given a fresh hearing before reassessment.

Ratio Decidendi: Where a statutory application for cancellation of an ex parte tax assessment is made within limitation, prolonged failure of the authority to decide it can justify setting aside the assessment to secure a hearing before fresh assessment.

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