Any material or document that has been relied upon in passing an order or a judgment must be made available to all the parties, the failure of which will lead to violation of principles of natural justice and fair play. A Division Bench comprising of Justice Satish Chandra Sharma and Justice S Vishwajith Shetty while adjudicating the matter in The PR Commissioner of Income Tax v. M/s Google India Pvt Ltd. [ITA NO.502/2018] dealt with the issue of the doctrine of audi alterem partem and its application in day-to-day situations.

The appellant company Google India Pvt Ltd is incorporated under Companies Act, 1956. The appellant company entered into an agreement with Google Ireland Limited to render support services in in administering the Google editorial guidelines in relation to global advertisements and responding to the queries from customers globally. Google Ireland Ltd separately compensated the appellant company for rendering outsourced services. The respondent assessing officer determined the appellant as ‘assessee in default’ in respect of non-deduction of tax at source for the sums payable to Google Ireland as ‘fee for distribution rights’ and consequently, attaching a tax liability of around ₹8 lakhs for the assessment year 2007-08. The appellant assessee appealed before Income Tax Appellate Tribunal. The Tribunal dismissed the appeal of the appellant.

The counsel representing the appellant contended that the Tribunal did not decide the dispute on merits despite several documents filed before the Tribunal by the appellants. The Tribunal was said to have conducted its own research and delivered a judgment based on that research. The material on which judgment was delivered by the Tribunal was not shared with the appellants and thus there was no justice or fair play. The counsel for the respondent contended that the material which has been relied upon by the Tribunal is available on internet and merely because the material which is available on internet was not given to the assessee, it does not mean that there is violation of natural justice and fair play.

The Court had to decide whether the Tribunal had violated the principles of natural justice and fair play by not allowing the appellant to argue the case and provide fresh evidence. Upon considering the facts, the Court held that there is clear evidence which proves that the principles of natural justice have been violated as complete material was not handed over to the appellant-assessee before the Tribunal based on which the order has been passed by the Tribunal, and hence sounded the judgment that, “The order passed by the Tribunal in the said appeals are set aside and the matters are remanded back to the Tribunal to decide the appeals afresh in accordance with law. The parties will appear before the Tribunal and within a period of 15 days the appellant shall be free to file the documents/additional documents in support of his contentions and the revenue shall also be free to file documents/additional submissions in support of their contentions. In case any other material is being relied upon by the Tribunal, the same shall also be made available to the assessee/appellant as well as to the counsel for revenue before passing a final order. The Tribunal is requested to make all possible endeavour to decide the matters at an earlier date.”

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