Procedural fairness in tax assessment requires reply time and personal hearing before final orders are issued.

An assessment order passed before expiry of the time granted to file a reply, and without affording a personal hearing, was held to violate procedural fairness and deny a proper opportunity to defend the case. The Madras HC set aside the assessment and consequential summary order and remanded the matter for fresh consideration after receipt of the reply, clear notice and a personal hearing.

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Issues: Whether the assessment order and consequential summary order could be sustained when they were passed before the time granted for filing reply had expired and without affording a personal hearing.

Analysis: The petitioner was granted time to submit a reply to the show cause notice, but the impugned assessment order was passed before that time expired. The record also showed that no opportunity of personal hearing was provided before confirming the proposals in the show cause notice. These circumstances disclosed a breach of procedural fairness and denial of a proper opportunity to defend the case.

Conclusion: The impugned orders were set aside and the matter was remanded to the respondent for fresh consideration after receiving the petitioner's reply and granting a clear notice and personal hearing.

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