Srei Equipment Finance LTD. vs. The State Tax Officer

Facts

The petitioner, Srei Equipment Finance Ltd., challenged a penalty order dated 13.11.2017 by filing an appeal before the 3rd respondent, the Joint Commissioner (Appeals) V. The petitioner also filed an application for condonation of delay and an application for early hearing. The appellate authority issued a notice for hearing on 09/07/2020. The petitioner's counsel could not appear due to residing in a Covid containment zone and requested an adjournment via email. This request was allegedly turned down, leading to an ex-parte order dated 09/07/2020, rejecting the appeal. The petitioner contended that principles of natural justice were violated.

Held

The Court held that the impugned appellate order (Ext.P7) suffered from a violation of the principles of natural justice. The Court acknowledged that the entire State was affected by the Covid-19 pandemic, with several areas declared as containment zones, restricting movement. It was noted that the petitioner's counsel had informed the appellate authority about the situation and requested an adjournment via Ext.P6. The Court found that this request was not considered, leading to the ex-parte order dismissing the appeal. Consequently, the Court found that an opportunity of hearing was not granted to the petitioner. The appeal along with all pending applications were remitted for fresh consideration by the 3rd respondent. The petitioner was directed to appear on 12.04.2021 at 11:30 am, and the respondent was directed to decide the appeal within two months from the date of the first hearing.

Key Issues

1. Whether the appellate authority violated the principles of natural justice by passing an ex-parte order without considering the petitioner's request for adjournment due to Covid-19 restrictions, thereby denying a fair opportunity of hearing? The petitioner argued that their counsel was unable to appear for the hearing on 09/07/2020 because the area where they resided was declared a Covid containment zone, restricting movement. They submitted a request for adjournment via email (Ext.P6), which they claim was not considered by the 3rd respondent. This, they contended, led to the violation of natural justice principles and the passing of an ex-parte order (Ext.P7) rejecting their appeal. The revenue, represented by the learned Government Pleader, contended that a fair opportunity of hearing was granted to the petitioner, and the petitioner failed to avail it. Therefore, the petition should be dismissed.