Natural justice breach in registration refusal led to restoration for fresh consideration after proper opportunity of hearing.

Rejection of a statutory registration application on a technical ground not put to the applicant was held to violate natural justice. The applicant had furnished the called-for documents, but was not given notice that ineligibility under the specific clause was the proposed basis of refusal. As no effective opportunity was afforded to meet that ground, the rejection could not be sustained and the matter was restored for fresh adjudication after a proper hearing.

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Issues: Whether the rejection of the application for registration under section 80G(5) on the ground of filing under the wrong clause, without confronting the applicant with that proposed basis of rejection, violated natural justice and warranted restoration of the matter.

Analysis: The application was rejected on a technical ground that the wrong provision had been chosen in Form 10AB. The record showed that the documents called for were furnished, but the applicant was not put to notice that it was considered ineligible under the particular clause invoked by the authority. Since no effective opportunity was granted to meet the specific reason for rejection, the decision was held to suffer from breach of the principles of natural justice. In these circumstances, a fresh consideration by the authority after affording reasonable and adequate opportunity was found necessary.

Conclusion: The rejection could not be sustained and the matter was restored to the authority for fresh adjudication after giving the applicant a proper opportunity of hearing.

Ratio Decidendi: An order rejecting a statutory application on a ground not confronted to the applicant, without affording a reasonable opportunity to meet that ground, is vitiated for breach of natural justice and may be set aside for fresh decision.

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