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2020 (11) TMI 1112 - HC - Income TaxApplication for compounding u/s 279(2) - application made was refused as it had been made after the order of conviction has been passed by the Criminal Court - HELD THAT:- Guideline 4.4(f) of the Circular in F. No. 285/90/2008-IT(Inv.)/12 dated 16.05.2008 issued by the CBDT directing that compounding should not be permitted when conviction order has been passed by the Criminal Court, has to be construed that it would not stand in the way for considering a compounding application when appeal against conviction by the Criminal Court is pending, as in this case. Though the Respondent has made a distinction for granting the benefit of compounding to others while denying the same to the Petitioner for the reason that their compounding applications have been made before conviction by the Criminal Court, such distinction cannot be of any avail in view of the binding decisions of the Division Benches of this Court. See UMAYAL RAMANATHAN [2009 (4) TMI 36 - MADRAS HIGH COURT] Conduct of the Petitioner by non-cooperation at the initial stage disentitles him to any relief - It would have to be examined with reference to the well known canons of the principles of natural justice that no material could be relied against a person without affording him an opportunity to explain his position before taking any decision entailing adverse civil consequence to him. In the fact situation that has arisen in this case, it was incumbent upon the Respondent to have informed the Petitioner before passing the impugned order that it was proposed to deny relief on account of such non-cooperation at the initial stage of the proceedings by bringing the same to his notice and supplying copies of the materials relied in support of the same, and calling upon him to submit explanation and also afford an opportunity of personal hearing, in that regard. The explanation of the Petitioner, if submitted, ought to be then considered before taking the final decision in the matter. Such exercise apparently has not taken place in the instant case as seen in the impugned order. The result of the foregoing discussion is that the impugned Order passed by the Respondent cannot be sustained and it is set aside and the matter is remitted to the Respondent for fresh determination of the matter. It is incumbent upon the Respondent to take into account the aforesaid conclusions arrived by this Court, conduct enquiry affording opportunity of personal hearing to the Petitioner following the prescribed procedure in consonance with the principles of natural justice, deal with each of the contentions raised by the Petitioner and pass reasoned orders on merits.
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