The principles of natural justice must be followed by quasi-judicial tribunals in every process of their functioning, including the initiation of prosecution.

1. - By this writ petition filed under Articles 226 and 227 of the Constitution, the petitioners have prayed for quashing the order annexure 13 dated May 31, 1988, whereby the waiver petition filed under Sections 273A and 273A of the Income-tax Act, 1961 (hereinafter referred to as "the Act"), has been rejected. A direction has also been sought for reconsideration of the waiver petition by the non-petitioners or, in the alternative, the petitioners have claimed waiver of the penalty amounting to Rs. 29,600 imposed against them under Section 271, vide order annexure 6 dated March 12, 1987, They have further sought relief by way of quashing of the order, annexure 15, dated December 12, 1988, the notice annexure 16 dated February 15/24, 1988, the order annexure 21, dated March 23, 1989, and the complaint annexure 20 pending in the Court of the Chief Judicial Magistrate (Economic Offences), Jaipur.

2. The facts necessary to be noticed for the disposal of this writ petition briefly stated are : that petitioner No. 1, M/s. Shree Singhvi Bros, is a registered partnership firm and petitioners Nos. 2 and 3, Shri Kushal Singh and Laxmansingh, are its partners. It is alleged that a search was conducted at the business premises as well as at the residential premises of the partners under the provisions of Section 132 of the Act on May 6, 1981. During the course of the search, 65 kgs. of silver was found, out of which 16 kgs. of silver/silver ornaments were treated as unexplained by the Authorised Officers of the Income-tax Department and, therefore, the Department included its value amounting to Rs. 32,000 in their income for the assessment year 1982-83 while making the regular assessment. The petitioners explained that this silver belonged to Shri Mohansingh, Shri Banshilal and Shri Abdul Razid. After an order under Section 132 of the Act was made on August 1, 1981, the petitioner firm filed its return on October 1, 1982. However, the learned Income-tax Officer was not satisfied with this explanation and he included the value of 16 kgs. silver amounting to Rs. 32,000 in their income and further imposed a penalty of Rs. 29,600 under Section 271 of the Act on the tax amounting to Rs. 14,880.

3. An appeal was filed against this regular assessment and that came to be dismissed by the learned Appellate Assistant Commissioner of Income-tax, Udaipur Range, Udaipur, vide order annexure 2 dated September 19, 1985. Thereafter, by order annexure 3 dated July 23, 1987, the learned Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, also sustained the addition in question to the tune of Rs. 28,800. It may be stated here that the addition of Rs. 32,000 was reduced to Rs. 28,800 by the learned Appellate Assistant Commissioner and to this extent, the order of the learned Appellate Assistant Commissioner was sustained by the learned Tribunal.

4. Thereafter, the petitioners filed an application under Section 132(11) of the Act and that too was dismissed by the learned Commissioner of Income-tax, vide order annexure 5 dated June 14, 1984.

5. According to the petitioners, the maximum amount of penalty has been imposed in this case, vide order annexure 6 dated March 12, 1987, under Section 271 of the Act, and, therefore, they filed an appeal against this order before the Commissioner of Income-tax (Appeals), Jaipur, and the same is still pending. No final order has been passed but the written arguments which were submitted before the learned Commissioner of Income-tax (Appeals) are contained in annexure 7. Thereafter, it is alleged that the petitioners filed an application before the learned Commissioner of Income-tax, Income-tax Department, under Section 273A of the Act for waiver or substantial reduction in the penalty imposed against them. A copy of the waiver petition has been filed and marked as annexure 8.

6. The petitioners have submitted that as per Section 273A of the Act, the Income-tax Commissioner has discretion either on his own motion or o