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2016 (3) TMI 1156 - HC - VAT and Sales TaxValidity of assessment order - principles of natural justice - the applications for rectification/correction of mistake has been rejected, behind the back of petitioners - whether opportunity of hearing should be granted when the rectification is sought for by the assessee himself and he wants certain corrections in the orders on grounds as are raised in the rectification application? Held that: - the Full Bench of the Delhi High Court has dealt with this question in the case of Smart Private Limited [1990 (2) TMI 49 - DELHI High Court]. In the case before the Full Bench of Delhi High Court, the provision of section 254(2) of the Income Tax Act was interpreted and Justice Kripal (as he then was and who has authored the Judgment) after taking note of the provisions of section 254(2) of the Income Tax Act has discussed in detail the import and effect of the provisions of Section 254(2) - the learned Full Bench has come to a conclusion that principles of natural justice have to be read into the provisions of section 254(2) and it has been held that this provision has been inserted in the statute by way of abundant caution to give certain right to a person who is aggrieved by an order passed, and if being aggrieved by certain order passed the statute gives a power to the aggrieved person to file an application, a presumption has to be drawn that the statute correspondingly gives a right to that person for an opportunity of hearing with regard to acceptance or otherwise of the application filed by virtue of the right which accrues to the person on account of the statutory provision. In the case of Punjab National Bank & Ors. Vs. Kunj Behari Mishra, [1998 (8) TMI 594 - Supreme Court of India], it has been held by the Supreme Court that even if a statutory rule does not provide for an opportunity of hearing if the order impugned has the effect of affecting the rights of person adversely then the requirement of the principles of natural justice has to be read into the Rules. The requirement of grant of opportunity of hearing or following the principles of natural justice before rejecting an application under section 54(1), has to be read into the rules and in dismissing the application on the grounds as indicated in the impugned orders dated 13.05.2015, without hearing the petitioners, an error has been committed by the department. Petition allowed and matter remanded to back to the Assistant Commissioner, Commercial Tax, Chhindwara with a direction to issue notice to the petitioners, hear them on the application for rectification and, thereafter pass an order.
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