Ex parte Tribunal order recalled for sufficient cause; High Court upheld discretionary relief after finding non-appearance properly explained.

The Tribunal may recall an ex parte order where the assessee shows sufficient cause for non-appearance under Rule 24 of the Income-tax (Appellate Tribunal) Rules, 1963. Here, the Tribunal accepted that the notice had been wrongly returned by the postal authorities and was satisfied that the default was adequately explained. The HC held that the Tribunal had exercised its discretion properly in recalling the ex parte order and declined to interfere. The revenue's challenge failed because no substantial question of law arose from the Tribunal's satisfaction on the explanation for absence.

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Issues: (i) Whether the Tribunal was justified in recalling its ex parte order on the assessee's explanation for non-appearance.

Analysis: Rule 24 of the Income-tax (Appellate Tribunal) Rules, 1963 permits the Tribunal to recall an ex parte order where sufficient explanation is furnished for the default in appearance. The Tribunal accepted the assessee's explanation that the notice had been wrongly returned by the postal authorities and was satisfied that the non-appearance was adequately explained. The High Court found that the Tribunal had exercised its discretion correctly in recalling the ex parte order.

Conclusion: The recall of the ex parte order was upheld and the challenge by the revenue failed.

Final Conclusion: The appeal was dismissed as no substantial question of law arose from the Tribunal's exercise of discretion under the applicable rule.

Ratio Decidendi: An ex parte order of the Tribunal may be recalled where sufficient explanation is shown for non-appearance, and such exercise of discretion will not be interfered with when it is based on a proper satisfaction of the Tribunal.

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