Natural justice breach where documentary evidence was ignored and uncommunicated statements were relied on, order quashed and remanded.

The adjudication order was quashed for breach of natural justice where the Proper Officer failed to consider or record reasons for rejecting the petitioner's documentary evidence relating to movement and delivery of goods and relied on statements of vehicle owners that were not supplied to the petitioner. The court found denial of a fair hearing and remanded the matter for fresh adjudication, directing that any statements relied upon be furnished and the petitioner be afforded an opportunity to confront, cross-examine and be heard, to be completed expeditiously.

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Issues: Whether the adjudication order dated 27 February 2025 is vitiated by violation of principles of natural justice and failure to consider or record reasons for rejecting documentary evidence regarding movement of goods, thereby warranting interference and remand for fresh adjudication.

Analysis: The Court examined whether the Proper Officer considered the documentary replies furnished by the petitioner relating to movement and delivery of goods (invoices, transporter records, delivery acknowledgements, e-way bills, supplier returns and payment details) and whether the order contains any reasoning explaining why those documents were insufficient. The Court also examined whether the Proper Officer relied on statements of vehicle owners without supplying those statements to the petitioner or affording an opportunity to confront or cross-examine the declarants, and whether such reliance without providing an opportunity to rebut amounts to a breach of natural justice. The Court compared the facts with applicable precedent and found the adjudication order devoid of any reasoning on the petitioner's documentary evidence and reliant on uncommunicated statements, resulting in denial of a fair hearing.

Conclusion: The adjudication order dated 27 February 2025 is quashed for violation of principles of natural justice and for failure to consider and record reasons regarding the petitioner's documentary evidence; the matter is remanded to the Proper Officer for fresh adjudication after supplying any statements relied upon and affording the petitioner an opportunity of cross-examination and hearing, to be completed expeditiously.

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