Relief for Aircel: HC Quashes Penalty Issued with 24‑Hour SCN Response Time; Orders Fresh Hearing with Adequate Notice:

Relief for Aircel: HC Quashes Penalty Issued with 24‑Hour SCN Response Time; Orders Fresh Hearing with Adequate Notice

The High Court quashed the impugned order in the matter of Aircel Limited vs Union of India, holding that it was passed in blatant violation of natural justice. The Court noted that the petitioner was given less than 24 hours to respond to the show cause notice and was denied an opportunity for a personal hearing before the penalty was finalised. Stressing that procedural fairness is essential even in faceless assessments, the Court found the order unsustainable.

The matter was remanded to the second respondent for fresh consideration. The petitioner was directed to file a detailed reply with supporting documents within two weeks of receiving the Court’s order. The assessing officer was instructed to provide at least 14 days’ notice for a personal hearing and to thereafter pass a fresh, reasoned order. The writ petition was disposed of with no order as to costs, and all connected miscellaneous petitions were closed.

Issue Raised: Whether a penalty order passed under Section 271(1)(c) without granting a personal hearing or adequate time to reply violates principles of natural justice and warrants judicial interference. HC's Decision: The High Court annulled the contested penalty order, ruling it was issued in clear violation of natural justice principles. The Court observed that the petitioner had less than 24 hours to respond to the show cause notice and was not given an opportunity for a personal hearing before the penalty was enforced. Emphasising that procedural fairness is essential even in faceless assessment schemes, the Court concluded the order was unsustainable.

Accordingly, the matter was remanded to the second respondent for fresh consideration. The petitioner was directed to submit a detailed reply with all supporting documents within two weeks of receiving the Court’s order. The assessing officer was instructed to provide a clear 14‑day notice for a personal hearing and thereafter pass a fresh, reasoned order.

The writ petition was disposed of with no order as to costs, and all connected miscellaneous petitions were closed.

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