Tax demand order set aside for lack of effective hearing; matter remanded for fresh consideration after reply and personal hearing.

Tax demand proceedings were set aside where the petitioner had not been given an effective opportunity to contest the demand on merits. Although pre-assessment and show cause notices had been issued and the demand had already been recovered from the bank account, the HC held that the matter required fresh consideration because revenue interest stood secured and the petitioner should be allowed to file a reply and be personally heard. The impugned order was therefore quashed and the assessment-related proceedings were remanded to the tax authority for reconsideration in accordance with law.

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Issues: Whether the impugned tax order was liable to be set aside and the matter remanded for reconsideration with an opportunity to reply and be heard.

Analysis: The petitioner asserted that the tax proceedings had proceeded without effective notice, while the respondent referred to the pre-assessment notice, show cause notice, reminder, and the delay in approaching the Court. The tax demand with interest had already been recovered from the petitioner's bank account, so revenue interest stood secured. In these circumstances, the Court found that the petitioner should be given an opportunity to contest the demand on merits, and the matter required fresh consideration by the respondent.

Conclusion: The impugned order was set aside and the matter was remanded for reconsideration after permitting the petitioner to file a reply and after affording a personal hearing.

Final Conclusion: The dispute was not finally adjudicated on merits, and the assessment-related proceedings were reopened for fresh decision by the tax authority.

Ratio Decidendi: Where tax liability has already been secured and the affected party has not had a proper opportunity to contest the demand, the order may be set aside and the matter remitted for fresh adjudication with notice and hearing.

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