Natural justice breach in adjudication order leads to setting aside and remand for fresh hearing.

An adjudication order was vitiated where the assessee was not given effective notice of personal hearing despite having replied to the show cause notice and informed the department of its changed address. Notices were sent to the old premises, there was material suggesting non-receipt, and the assessee was thereby denied a meaningful opportunity to defend itself; the ex parte order could not be sustained for breach of natural justice. The writ court's refusal to entertain the grievance on the ground of alternative remedy was also found unsustainable. The order was set aside and the matter remitted for fresh hearing and reconsideration.

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Issues: Whether the adjudication order, passed without effective notice of personal hearing to the assessee, was liable to be set aside for violation of the principles of natural justice.

Analysis: The assessee had replied to the show cause notice and the department was aware of its change of address, yet notices of hearing were sent to the old premises and there was material indicating non-receipt. In these circumstances, the assessee was deprived of a meaningful opportunity to defend itself before the adjudicating authority. An ex parte adjudication involving duty, interest and penalty could not be sustained when the right of hearing was not effectively afforded. The writ court ought not to have rejected this grievance while relegating the assessee to an alternative remedy without keeping the point open.

Conclusion: The adjudication order was vitiated for breach of natural justice and was set aside, with a direction for fresh hearing and reconsideration by the Commissioner.

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