Service of notice and Receiver's possession proved decisive; Tribunal order set aside and matter remitted for fresh consideration.

Penalty proceedings based on alleged service of notices at factory premises were found unsustainable where the unit had been taken over by a Receiver and later handed to a Bank. The Tribunal failed to examine whether notice was actually served on the assessee or the Receiver, and did not consider the legal effect of the Receiver's possession. It also omitted to address the assessee's objections on the taxability of molasses and the earlier decisions relied upon. The order was therefore set aside and the matter remitted for fresh consideration after adequate notice.

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Issues: Whether the penalty order and the Tribunal's affirming order could be sustained when the assessee's case was proceeded with ex parte and the Tribunal did not examine the effect of the Receiver's possession and service of notice.

Analysis: The penalty proceedings were founded on notices said to have been served at the factory premises, but the record showed that the unit had been taken over by a Receiver and later handed over to the Bank. The Tribunal did not address whether notice was actually served on the assessee or on the Receiver, nor did it consider the legal effect of the Receiver's possession. The Tribunal also failed to examine the assessee's objections on the taxability of molasses and the relevance of the earlier decisions relied upon. In these circumstances, the order under challenge lacked proper consideration of the material issues.

Conclusion: The Tribunal's order was not sustainable and the matter had to be reconsidered after giving adequate notice to the assessee.

Final Conclusion: The revisions succeeded, the Tribunal's order was set aside, and the matter was remitted for fresh decision on the issues involved.

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