Natural justice requires an effective hearing before assessment; order set aside after denial of opportunity to produce records.

An assessment order passed without granting an effective opportunity of hearing is unsustainable where the assessee has sought time to collect and produce records. The Assessing Authority proceeded without fixing a further date after the request for time, depriving the assessee of a reasonable chance to place materials. That omission amounted to a breach of the principles of natural justice, so the assessment was set aside. The matter was left open for fresh consideration by the Assessing Authority after giving one more opportunity to the assessee.

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Issues: Whether the assessment order could be sustained when it was passed without affording an effective opportunity of hearing, and whether the writ appeal deserved to be allowed.

Analysis: The appellant had sought time to collect records and submit documents. The Assessing Authority proceeded to pass the assessment order without fixing a further date for hearing after the request for time. In the circumstances, the appellant could legitimately expect a notice fixing the date of hearing so that he could appear and place his materials. The omission to do so resulted in denial of an effective opportunity and rendered the assessment order unsustainable on the ground of violation of the principles of natural justice.

Conclusion: The assessment order was liable to be set aside for breach of natural justice, and the writ appeal was allowed.

Final Conclusion: The assessment was annulled and the matter was left open for fresh consideration by the Assessing Authority after granting one more opportunity to the appellant.

Ratio Decidendi: An assessment order passed without granting an effective hearing, especially where the assessee has sought time to produce records, cannot be sustained as it violates the principles of natural justice.

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