Rejection of adjournment request without proper consideration Karnataka High Court quashes order

Toyota Industries Engine India Private Limited Vs CIT 

In a significant judgment, the Karnataka High Court quashed an Income Tax order against Toyota Industries Engine India Private Limited, highlighting a crucial aspect of natural justice. The court emphasized the importance of considering adjournment applications, especially when their rejection can cause substantial prejudice to the parties involved. This article provides an in-depth analysis of the case, the court’s reasoning, and its implications for similar future disputes.

The petitioner, Toyota Industries Engine India Private Limited, challenged the order dated March 18, 2024, passed by the respondent under Section 250 of the Income Tax Act, 1961, for the assessment year 2021-22. The challenge was based on the alleged violation of the principles of natural justice by the First Appellate Authority.

Sri T. Suryanarayana, the learned Senior Counsel appearing for the petitioner, argued that the impugned order was passed without considering the petitioner’s request for an adjournment. On March 14, 2024, the petitioner had sought an adjournment to a date after

April 15, 2024, as documented in Annexure-G. Despite this, the First Appellate Authority proceeded with the appeal, stating in its order that no adjournment petition had been filed and finalized the proceedings based on the material available on record.

Upon examining the order, the Karnataka High Court noted that the First Appellate Authority had indeed ignored the petitioner’s request for an adjournment. The court found this to be a clear violation of the principles of natural justice. The rejection of the adjournment request without proper consideration was deemed to have caused significant prejudice to the petitioner.