Deciding A Case Ex-Parte On Merits Without Giving Reasonable Opportunity To Parties Is Blatant Violation Of “Audi Alterum Partem”- Allahabad HC

The Allahabad High Court observed that deciding a case ex-parte on merits without giving reasonable opportunity to parties is blatant violation of rule of “Audi alteram partem”.

The Lucknow Bench observed thus in a revision by which a company challenged the order of the Commercial Tax Tribunal.

A Single Bench of Justice Alok Mathur elucidated, “Even otherwise, deciding a case ex parte on merits without giving reasonable opportunity to the parties is blatant violation of rule of "Audi alterum partem". In absence of the appellant, the Commercial Tax Tribunal had the authority to dismiss the appeal in default as provided in the Order XLI Rule 17 of the Code of Civil Procedure, 1908 rather than hearing it ex parte and deciding it on merits.”

The Bench noted that on one hand, the general law of land enshrined in the Code of Civil Procedure (CPC) provides that in absence of plaintiff/appellant, the suit or appeal should be dismissed for want of prosecution, while it was contended by the Standing Counsel that as per Rule 63 of the U.P. Value Added Tax Rules, 2008, it is open for the Tribunal to consider and decide the appeal on merits even where despite of service of summons, the appellant does not appear before the Tribunal.

Advocate Anand Dubey represented the revisionist while Standing Counsel represented the opposite party.

In this case, the counsel for the revisionist submitted that the order of the Tribunal was challenged on the ground that on the date fixed, the counsel of the revisionist/appellant could not appear before the Tribunal and only on hearing the representative of the State, the second appeal was decided. The Tribunal further recorded that despite information and service being sufficient upon the revisionist, no one had appeared and accordingly, the Tribunal was proceeding to decide the case on merits.

The question raised by the revisionist in the revision was as to whether in absence of counsel of the revisionist/appellant, the Commercial Tax Tribunal can proceed to consider and decide the appeal 'ex parte' in absence of the revisionist/appellant. It was submitted that the principles with regard to appearance of the plaintiff or defendant and order to be passed thereon and as to how the court could proceed in the matter of suits and appeals has been provided under CPC.

The High Court in the above context of the case said, “This Court has given due consideration to the rival contentions and for the reasons given below, this Court is of the considered view that where the appellant does not appear before the Tribunal, the appeal should be dismissed for want of prosecution rather than deciding the same on merits. Proviso to Rule 63 (4) of the U.P. Value Added Tax Rules, 2008 provides that if despite proper service of the notice either party is not present, the appeal may be heard and decided ex parte.”

The Court added that the word 'ex parte' can be given its natural meaning as appearing in the CPC and the Tribunal can proceed to consider and decide the case ex parte in a situation where only the appellant appears, but the respondent/State does not appear, while in a case, where the appellant does not appear, the only consequence of such a situation would be to dismiss the appeal for want of prosecution and not to enter and decide the case on merits of the controversy.

“… this Court has held that wherein an appeal is decided ex parte, it shall be open for moving an application for rectification of such a situation. Accordingly, adequate reasons are given for the defendant for non appearance and judgement is rendered ex parte, but recall of order, exercise of rectification has been provided under Section 31 of the U.P. Value Added Tax Act, 2008”, it concluded.

Accordingly, the High Court disposed of the revision, set aside the impugned order, and remitted the matter to Tribunal.

Cause Title- M/s Rajdhani Arms Corporation v. Commissioner of Commercial Tax U.P. (Neutral Citation: 2024:AHC-LKO:47957)

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