Order disallowing exemption on high sea sales turnover set aside for lack of natural justice. Petitioner granted personal hearing.

The impugned order disallowing exemption on high sea sales turnover was set aside in the case due to a violation of principles of natural justice. The court ruled in favor of the petitioner, a Limited Company, emphasizing the importance of affording a personal hearing before making such decisions. The matter was remitted back for a fair hearing, with the authority directed to provide the petitioner with a personal hearing and proceed lawfully within eight weeks. The writ petition was disposed of without costs, concluding the legal proceedings concerning the lack of personal hearing in the case.

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Issues: Violation of principles of natural justice in passing the impugned order, opportunity of personal hearing not afforded to the petitioner, disallowance of exemption on high sea sales turnover

Analysis:
1. The petitioner, a Limited Company, reported turnover for the assessment year CST/2014-15, including consignment sale, stock transfer, interstate sales, and high seas sales. The first respondent issued a notice proposing to disallow sales to registered dealers under Section 8(1) of the CST Act, leading to a series of submissions and assessments by both parties.

2. The petitioner argued a violation of principles of natural justice, claiming that despite submitting Audit Report for high sea sales, no opportunity of personal hearing was provided by the first respondent. Citing the decision in SRC Projects Pvt.Ltd. vs. Commissioner of Commercial Taxes, the petitioner sought to set aside the order and remit the matter back for a fair hearing.

3. The learned Government Advocate for the first respondent acknowledged the need for a personal hearing and agreed to offer the petitioner the opportunity. However, the attachment made in the bank account was not contested by the petitioner, leading to a discussion on the implications of the SRC Projects Pvt.Ltd. decision on the case at hand.

4. The Division Bench's ruling in SRC Projects Pvt.Ltd. emphasized the importance of affording a personal hearing when demanded, ensuring fairness in procedure. In this case, the petitioner's grievance centered around the lack of personal hearing before the disallowance of exemption on high sea sales turnover of &8377; 7,18,29,120/-.

5. In light of the decision and the petitioner's plea, the impugned order related to the disallowance of exemption on high sea sales turnover was set aside. The matter was remitted back to the authority concerned with a directive to provide the petitioner with a personal hearing and proceed in accordance with the law within eight weeks from the date of the order.

6. Consequently, the writ petition was disposed of without costs, and connected miscellaneous petitions were closed, concluding the legal proceedings surrounding the violation of principles of natural justice and the need for a fair opportunity of personal hearing in the case at hand.

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