' M.A. JAVED SHAHEEN (JUDICIAL MEMBER).---The registered person has filed the titled appeal against Order-in-Appeals Nos.2576-2580 of 2008 dated 29-5-2008 passed by the learned Collector of Customs, Federal Excise and Sales Tax (Appeals), Faisalabad.
2. Briefly stated the facts of the case are that the appellant-registered person is a manufacturer- cum-exporter engaged in making of textile goods claimed refund of input tax pertaining to October, 2006 involving an amount of Rs,10,900 incurred in connection with zero-rated supplies. The registered person was however issued a show-cause notice dated 17-11-2007 that as to why refund claimed may not be rejected under section11(2) read with Rule 37 of Sales Tax Rules, 2006 (Refund Rules) notified vide S.R.O. 555(1)12006 dated 5-6-2006.
3. Upon adjudication proceedings, appellant was proceeded in absentia without affording him with any opportunity of hearing and passed Sales Tax Order-in-Original No,1221 of 2008 dated 10-1-2008.
The registered person being aggrieved by the said order filed the first appeal before Collector of Appeals who rejected the same as time-barred by 27 days in terms of section 45B of the Sales Tax Act, 1990. The appellant feeling dissatisfied with the treatment accorded by the Collector (Appeals) has come up in appeal before this Tribunal.
4. The learned AR on behalf of registered person elaborated that the adjudication proceedings carried out on the back of the appellant were in flagrant disregard of law in as much as the impugned order was passed by the adjudicating authority on ex parte basis without providing the appellant with any opportunity of being heard which is not only against the provisions of the Sales Tax Act, 1990 but also against the norms of natural justice. Learned Advocate further contented that the order passed by the Assistant Collector i,e, adjudicating authority on ex parte bask is an illegal and void order therefore question of time limitation would not arise against it and dismissal of appeal by the Collector (Appeals) on account of time limitation is also unjustified. To strengthen his contentions, learned Advocate cited a number of judgments of Superior Courts of the country.
5. The arguments of the learned representative. Of the appellant have been heard and orders of the authorities below as well as the case law cited by the learned AR of the registered person have also been perused.
6. It is an admitted fact that the learned adjudicating authority has decided the case on ex parte basis without providing the registered person with any opportunity of hearing which is not only against the-provisions of Sales Tax Act, 1990 but also against the norms of natural justice as the cardinal principle of "Audi Alteram Partem i,e, Nobody should be condemned unheard" has not been observed.
7. I am of the considered view that no order affecting the rights of a person should be passed without providing him an opportunity of being heard. There is a general principle of law that one should not be condemned unheard as laid down in (Maxim audi alteram partem). Expeditious disposal of case are appreciable but it should not happen at the expense of justice. Court must take proper care to afford proper opportunity and should not give any impression of under haste or rush up, such disposal will be at the expense of their fair name.
' In this regard, I feel advantage to reproduce the relevant provisions of section 11(4) of the Sales Tax Act, 1990 which reads as under:-- Section 11(4) of the Act ' No order under this section shall be made by an officer of Sales Tax unless a notice to show-cause is given within five years to the person in default specifying the grounds on which it is intended to proceed against him and the officer of Sales Tax shall take into consideration the representation made by such person and provide him with an opportunity of being heard: (Underlining ours)
8. From perusal of the above provisions of law makes it abundantly clear that providing of opportunity of hearing is mandatory condition which was not fulfilled by the adjudicating authority.
I therefore hold that right of personal hearing to a person against whom an adverse order is to be made is to be equated with fundamental right and an adverse order made without affording him an opportunity of personal hearing is to be treated as an illegal and void order. Said principle though is always deemed to be embedded in the statute and even if there is no such specific or express provision, it would be deemed to be one of the parts of the statute because no adverse action can be taken against a person without providing right of hearing to him.
9. The Hon'ble Supreme Court of Pakistan has very graciously mandated that provision of hearing to the person against any authority propose to proceed, has to be read in every statute irrespective of the fact that no such provision is incorporated therein. Reference in this behalf can conveniently be made to the judgment of honourable Supreme Court of Pakistan reported as (1994 SCM R 2232) wherein it has laid down as under:-- "It is a well-settled principle of natural justice that no court should adjudicate upon a right of party who was not before it or to whom no notice was given and thus an ex parte order will be no order in eyes of law. Maxim of "audi alteram parteni" i,e, no one should be condemned unheard is a universally established principle of natural justice which is applicable to both judicial and non-- judicial proceedings."
10. In another case reported as (2009 PTD 1507), the honourable Lahore High Court while deciding the similar controversy, held that:-- "An adverse order made without affording an opportunity of personal hearing is to be treated as a void order. It is because of this reason that Hon'ble Supreme Court of Pakistan has ways laid its utmost stress on strict observance of norms of natural justice in general and the principles of audi alteram partem in particular. These principles are to be read into every statute."
11. Reliance is also placed on judgment of Hon'ble Sinn High Court, Karachi reported as [1999 PTD 1358] wherein it was laid down that:- "Officer before passing an order which would adversely affect rights of a party should hear that person's explanation, clarification and argument in his defense submitted by him personally or through his counsel or his duly authorized agent. If such hearing is not given to person concerned, the order would be in violation of not only principles of natural justice but also of statutory requirements and consequently would be invalid."
12. So far as, dismissal of appeal by the learned Collector (Appeals) on account of time limitation, I hold that since the learned adjudicating authority decided the case on ex parte basis without providing with any opportunity of hearing and appellant was deprived of his precious right of being heard, such act violates not only principles of natural justice but also in contravention of mandatory provisions of law which vitiates all the proceedings conducted on the back of appellant therefore, no time limit would run against the order of the adjudicating authority. In this regard, I also gain support from the reported judgments of the Honourable Supreme Court of Pakistan reported as (1987 SCM R 1543) and (2007 SCM R 834), the relevant extract from the judgments are reproduced hereunder for reference:-- "Order passed in violation of mandatory provisions of law--Validity---Limitation---No period of limitation would run for challenging such order."
13. Reliance can also be placed on the judgments of honourable Supreme Court of Pakistan reported as (2007 SCM R 729) and (2007 SCM R 262) wherein it was laid down as under:-- " Void and illegal order---Limitation would not run against such orders."
14. Keeping in view the above discussion, both the orders of authorities below are declared to be illegal, void and without lawful authority and case is remanded back to adjudicating authority having jurisdiction 'with directions to provide an ample opportunity of being heard and to pass a fresh and speaking order. The registered person is directed to submit all the relevant documents before the learned adjudicating authority in support of his refund claim.
15. The appeal filed by the registered person is disposed of as above.