Natural justice in refund claims requires a hearing before rejection, and adverse orders without one will not stand.

Rejection of refund claims with civil consequences cannot be sustained unless the affected assessee is given a fair opportunity of hearing before the adverse decision is taken. The Court held that objections alone were insufficient to justify refusal of refund without allowing the assessee to explain entitlement and address the stated deficiencies. The rejection was set aside and the refund applications were remitted for fresh consideration after hearing the assessee.

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Issues: Whether the rejection of the refund applications was liable to be set aside for want of opportunity of hearing and whether the applications required fresh consideration after hearing the assessee.

Analysis: The rejection of refund applications entails civil consequences, and the assessee was entitled to be heard before any adverse decision was taken. The rejection could not be sustained on the basis of objections without affording an opportunity to explain entitlement to refund and address the stated deficiencies.

Conclusion: The rejection of the refund applications was set aside and the matters were remitted for fresh consideration after granting an opportunity of hearing to the assessee.

Final Conclusion: The assessee succeeded in obtaining judicial interference against the impugned rejection, and the refund claims were restored for reconsideration in accordance with natural justice.

Ratio Decidendi: An order rejecting refund claims having civil consequences cannot be sustained unless the affected party is given a fair opportunity of hearing before the decision is taken.

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