Mandatory personal hearing before adverse tax adjudication vitiates the order when statutory hearing rights are not followed.

An adjudication order passed under Section 74 was unsustainable where the mandatory opportunity of personal hearing under Section 75(4) was not afforded before an adverse determination. The absence of hearing was undisputed, and non-compliance with the statutory requirement vitiated the order. The order was set aside and the matter remanded for fresh adjudication after granting the petitioner an opportunity to respond and be heard.

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Issues: Whether the adjudication order passed under Section 74 was sustainable when no opportunity of personal hearing had been afforded under Section 75(4).

Analysis: The order was passed on a show-cause notice proposing an adverse determination for the relevant tax period. The mandatory requirement under Section 75(4) to afford a hearing before passing such an adverse order was not complied with, and the absence of personal hearing was not disputed. Non-compliance with the statutory hearing requirement rendered the adjudication unsustainable.

Conclusion: The order under Section 74 could not be sustained and was set aside. The matter was remanded for fresh adjudication after granting the petitioner an opportunity to respond and be heard.

Ratio Decidendi: Where the statute mandates an opportunity of hearing before an adverse adjudication, failure to grant such hearing vitiates the order and warrants setting it aside with remand for fresh decision.

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