Law: Income Tax Act, 1922

Section: 23(2),(4),26A

Income-tax Act (XI of 1922)---Ss. 23 (2), (4), 26-A-Assessment-Notice to produce evidence-Failure to comply with notice¬ Refusal to renew registration of firm-Notice whether necessary. The assessee firm failed, even after several adjournments, to comply with a notice issued by the Income-tax Officer under section 23 (2) of the Income-tax Act requiring the assessee to attend and produce evidence in support of its return. The Income-tax Officer exercised his power under section 23 (4) and refused its application for renewal of registration under section 26-A. The assessee appealed unsuccessfully to the Appellate Assistant Commissioner and then to the Appellate Tribunal, contending that the refusal to renew registration was invalid as no notice had been given to the assessee before refusing to renew registration. On a reference: Held, (i) that there was no duty imposed on the Income-tax Officer under section 23 (4) to give notice to the assessee intimating his intention to refuse the application for renewal of registration ; (ii) that as the assessee had availed itself of the right of appeal and had placed its view before the appellate authorities, ii could not be heard to complain, at the stage of reference before the High Court, that there was violation of the principles of natural justice. There was no such general principle that the party adversely affected should be heard at each and every stage of the administrative process. The principle of audi alteram partem was satisfied if the party affected was given sufficient opportunity to know the case he had to meet and to answer that case at some stage of the administrative proceedings. Sheopujan Choudhury v. State of Bihar A I R 1956 Pat. 212 ref. STATEMENT OF CASE These two applications are consolidated as a common question of law arises therefrom. 2. By these reference applications presented on June 4, 1957, the assessee requires the Appellate Tribunal to refer to the High Court a question of law which is said to arise out of the orders of the Appellate Tribunal, dated March 25, 1957, in I. T. A. Nos. 4226 and 4227 of 1956-57. Inasmuch as, in our opinion a question of law does arise out of the aforesaid…

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