Call book delay and natural justice led to quashing of long-pending show cause notices

Show cause notices left unadjudicated for nearly three decades could not be sustained where the department failed to inform the assessee that the matters had been kept in the call book or explain the delay. The Court held that prolonged inaction, without timely communication, prejudiced the assessee's ability to preserve records and defend the notices, and breached natural justice and procedural fairness. It applied the principle that adjudication of show cause notices must occur within a reasonable time and relied on the departmental expectation that parties be formally informed when notices are transferred to the call book. The notices were quashed and set aside.

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Issues: Whether 16 show cause notices could be sustained after an inordinate delay of about three decades, where the department had not informed the assessee that the notices were kept in the call book and the delay prejudiced the assessee's ability to meet the notices.

Analysis: The notices remained unadjudicated for an extraordinary period, and the record did not show any timely communication to the assessee that they were being kept in the call book or the reason for such course. The delay was not shown to have been caused by the assessee. The absence of notice that the proceedings were still alive prevented the assessee from safeguarding records and defending the notices effectively. The Court applied the principle that adjudication of show cause notices must occur within a reasonable time, and that keeping matters in abeyance without communication offends natural justice and procedural fairness. The Court also relied on the administrative expectation reflected in the departmental circular that parties should be formally informed when notices are transferred to the call book.

Conclusion: The show cause notices were liable to be quashed and set aside.

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