A Single Bench of Madras High Court has held that providing opportunity of being heard to each and every member of the society was not necessary for proceedings under Section 34A of the Income Tax Act 1961.
The petitioners V.Vimal Ravindra Raja and others were the Management Committee members of Victoria Edward Hall Society, Madurai. According to them, the Department of Commercial Taxes and Registration, had issued the impugned notice dated 15.05.2023 for conducting enquiry on the alleged irregularities with regard to the functioning of the Society.
However, even before conducting the enquiry, a Government Order in G.O.Ms.No.17, Commercial Tax and Registration (M1) Department, dated 01.03.2023, came to be passed, superseding the Management Committee of Victoria Edward Hall Society. Without recalling this Government Order, the impugned notice of enquiry came to be issued and therefore, the writ petition was filed.
S.Prabakaran, who appeared on behalf of the petitioners submitted that the said Government Order was challenged by the then office bearers of the Society by filing Writ Petition and this Court, by order dated 22.08.2022, allowed the writ petitions and remitted the matter for fresh consideration, after affording the opportunity of hearing to the members of the Society.
He further contended that fresh election was conducted and a new set of office bearers assumed charge. This Government Order was passed without affording an opportunity of hearing to the petitioners / the newly elected Management Committee Members and without recalling this Government Order, the first respondent has issued the impugned notice of enquiry, as an eyewash, to show as if they have provided due opportunity.
U. Bharanidharan, on behalf of the revenue submitted that this Court, by order dated 10.03.2023, in W.P.No.7179 of 2023, had directed them to pass appropriate orders on the representation of the petitioners dated 04.02.2023 after affording them due opportunity of hearing.
In pursuance of the said direction, the impugned notice of enquiry dated 15.05.2023 was issued before passing orders on the representation dated 04.02.2023.
A Single Bench of Justice B.Pugalendhi held that, the Government Order in G.O.Ms.No.17, Commercial Tax and Registration (M-1) Department, dated 01.03.2023, had been passed after affording the opportunity to the then Office Bearers, who were also the incumbent President, Vice President, Secretary, Treasurer of the Society, there was no necessity for providing opportunity to each and every member of the Society in the proceedings initiated under Section 34A of the Income Tax Act.
The bench the setaside the impugned notice of enquiry dated 15.05.2023 as it was not necessary, in view of the issuance of G.O.Ms.No.17, Commercial Tax and Registration (M-1) Department, dated 01.03.2023.
Since this Government Order had already been challenged before this Court and the said writ petitions were also pending consideration it was inappropriate for the court to take any decision.
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