The basic principle is that an order passed by an adjudicating body does not become effective until it is communicated to the person affected thereby.
Under various provisions of the Income-tax Act, 1961, every authority is required to pass an order that is statutorily required. However, passing it is not enough. Courts have emphasised that what is necessary to give effect to the order is its communication.
If an order passed by the authority is not communicated to the assessee or the concerned person, it raises serious issues. These have been considered by Courts time and again. The principles of natural justice are, by now, fully evolved and expounded by a catena of decisions. The importance of the rule of natural justice is not only to secure justice but also to prevent the miscarriage of justice. Admittedly, they do not supplant the law of the land, but supplement it. These principles are enunciated in the case of A. K. Kraipak v. Union of India (AIR 1970 SC 150), and have been followed in a number of judgments.
The principles laid down by the Supreme Court in the judgment are relevant because the effect of non-communication of the decision to the assessee will result in injustice. The very effectiveness of an order that is not communicated to the person against whom it is made is also questionable since such order would become effective only upon communication to the assessee against whom the decision has been taken.
No communication, no order
An order that operates to the detriment of the assessee and is not communicated to him would not be an effective order. The basic principle is that an order passed by an adjudicating body does not become effective until it is communicated to the person affected thereby. The principle is: No communication, no order.
This principle has been expounded by the Constitution Bench of the Supreme Court in the case of State of Punjab v. Amar Singh Harika (28 FJR 464); (AIR 1966 SC 1313). The brief facts of the case were that the respondent Amar Singh Harika was an Assistant Director, Civil Supplies, in the Patiala and East Punjab States Union (PEPSU).
He was dismissed from service by an order purported to have been passed on June 3, 1949, which was communicated to him on January 2/3, 1953. He filed a suit against the State of Punjab alleging that the impugned order under which he was dismissed was invalid, inoperative and illegal since it had been passed without holding any inquiry or following proper procedure.
He further sought a declaration that despite the order of dismissal, he continued to be an employee of the State of Punjab and to hold his post as Assistant Director, Civil Supplies. The trial court dismissed the suit of the respondent and, thereafter, the matter went up to the Supreme Court. The Court held that the mere passing of an order of dismissal would not be effective unless it is published and communicated to the officer concerned.
If the appointing authority passed an order of dismissal, but did not communicate it to the officer concerned, theoretically it is possible that unlike in the case of a judicial order pronounced in Court, the authority may change its mind and decide to modify its order. It may be that, in some cases, the authority may feel that the ends of justice would be met by demoting the officer concerned rather than dismissing him.
An order of dismissal passed by the appropriate authority, and kept with it, cannot be said to take effect unless the officer concerned knows about the order and it is otherwise communicated to all the parties concerned.
If it is held that the mere passing of the order of dismissal has the effect of terminating the services of the officer concerned, various complications may arise.
If before receiving the order of dismissal, the officer has exercised his power and jurisdiction to take decisions or do acts within his authority and power, those acts and decisions would not be rendered invalid after it is known that an order of dismissal had already been passed against him. The officer concerned would be entitled to his salary for the period between the date when the order was passed and the date when it was communicated to him.
Two essential ingredients
A Constitution Bench of the Supreme Court has held in the case of Bachhittar Singh v. State of Punjab (AIR 1963 SC 395), which was also a case of departmental inquiry, that the two essential ingredients of an order of the State Government are that the order has to be expressed in the name of the Governor and it has to be communicated.
The relevant portion of the reported decision is reproduced below:
Before something amounts to an order of the State Government, two things are necessary. The order has to be expressed in the name of the Governor as required by article 166(1) of the Constitution and then it has to be communicated. The Constitution requires that the action must be taken by the authority concerned in the name of the Governor.
It is not till this formality is observed that the action can be regarded as that of the State. Constitutionally speaking, the Minister is no more than an adviser and that the head of the State, the Governor, is to act with the aid and advice of his Council of ministers.
Therefore, until such advice is accepted by the Governor whatever the Minister or the Council of Ministers may say in regard to a particular matter does not become the action of the State until the advice of the Council of Ministers is accepted or deemed to be accepted by the Head of the State. Indeed, it is possible that after expressing one opinion about a particular matter at a particular stage, a Minister of the Council of Ministers may express quite a different opinion, one which may be completely opposed to the earlier opinion. In C.I.T. v. Dhatu Sanskar P. Ltd. (292 I.T.R. 135), the Gujarat High Court held that non-communication of an order that is likely to have a detrimental effect on the person concerned would not only be arbitrary and violative of the principles of natural justice but would also be invalid under the income-tax law.
Applying this principle, where a tax-payer makes an application that is required to be made under the law, it is for the Assessing Officer or any other authority to dispose of the same by an order in writing that must be communicated to the assessee. This would be so specially where an application is rejected by the authority. Non-communication of such order would render rejection of application inoperative in law.
H.P. Ranina (The author, a Mumbai-based advocate specialising in tax laws)