Law:

Section:

(a) Income Tax Ordinance (XLIX of 2001)--- ----Ss.114(4), 121, 131, 218 & 239---Failure to file return---Finalization of assessment ex parte---Annulment of assessment order---Appeal to Appellate Tribunal---Respondent/assessee who derived income from sale of utensils/crockery, having not filed return, a notice was issued to him under S.114(4) of Income Tax Ordinance, 2001, however, assessment was finalized ex parte at net income and assessee/respondent was issued a demand notice by Taxation Officer---Respondent/assessee filed appeal before Commissioner Income Tax (Appeals) which appeal was accepted and assessment order passed by Taxation Officer was annulled on the ground that notice was issued to person other than the respondent/assessee---Feeling aggrieved by said order of Commissioner - Income Tax (Appeals), Revenue had filed appeal before Appellate Tribunal---Main ground on which Commissioner Income Tax (Appeals), annulled the assessment order was ex parte action which was unjustified because notices under S.114(4) of Income Tax Ordinance, 2001 were not validly served upon the respondent/assessee---Mere issuance of notice was not sufficient unless it was validly served---Notice issued to or served upon some unrelated or unknown person was of no legal effect---Before taking any action on the basis of a notice, it was duty of the Authority issuing a notice to satisfy itself that the notice had been validly served---Purpose of notice was to afford an opportunity to the party to explain his position/stance to do the needful and/or to provide him an opportunity of hearing---Golden principle of natural justice was that no one should be condemned unheard---When issuance of notice was a statutory requirement, the subsequent proceedings taken on the basis of that notice without its valid. service were without jurisdiction and ab 'initio null and void--Before proceeding ex parte under S.121 of Income Tax Ordinance, 2001, a valid service of notice under S.114 of Income Tax Ordinance, 2001, was a mandatory requirement of law and non-observance thereof was fatal---Proceeding ex parte, did not mean to punish a party for his non-appearance; its purpose was decision of…

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