Adama India Private Limited Vs Union of India (Karnataka High Court)
The petitioner is a registered dealer. An audit was conducted. It filed reply. Audit report (Form ADT-02) was issued. The pre-show cause notice (DRC-01A) was issued. Pursuant to which, show cause notice (DRC-01) was issued. The petitioner filed reply submitting documents. The same was not considered as a reply and reminder was issued. The petitioner sought time to file detailed reply and filed the reply seeking personal hearing. Thereafter, the petitioner filed detailed reply. However, without considering the said reply and without granting a hearing, order came to be passed confirming demand of about Rs. 23 crores. The same was challenged in writ petition.
The Hon’ble High Court of Karnataka (Dharwad Bench) allowed the writ petition and set aside the impugned order.
It held:
(i) section 73(9) mandates that the reply of the assessee must be considered, which had not been done;
(ii) section 75(4) mandates a hearing after reply has been filed where request is received in writing;
(iii) section 73(10) mandates the time limit provided for passing the order; all provisions use the word “shall”;
(iv) section 107(11) does not empower the appellate authority to remand the matter back for non observance of provisions;
(v) alternate remedy is not a bar where there is violation of principles of natural justice;
(vi) follows coordinate bench judgments, Hon’ble High Court of Chhattisgarh judgment and Hon’ble High Court of Allahabad – Jugdments;
(vii) deals with Commerical Steel- Hon’ble Supreme Court judgment and explains the same;
(viii) remands the matter back to the adjudicating authority for de-novo consideration, on payment of costs of Rs.50,000/- by petitioner for delay in filing reply.
The matter was argued by Ld.Counsel Bharat Raichandani
