Non-speaking tax adjudication orders cannot stand when replies and supporting material are ignored, leaving demand vulnerable.

A tax adjudication order confirming demand was quashed for non-application of mind because it gave only a bare conclusion, failed to address the taxpayer's replies, reconciliation, supporting documents, and relied-upon CBIC circulars, and did not identify the taxable or exempt outward supplies in dispute. The Court held that liability cannot be sustained where the order does not meaningfully consider the assessee's explanation or material issues. Fresh adjudication was permitted on the show cause notice after considering all replies, granting a fresh hearing, and proceeding in accordance with law.

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Issues: Whether the impugned adjudication order confirming the demand could be sustained when it disclosed no cogent reasons, did not deal with the replies and reconciliation filed by the petitioner, and was set aside for non-application of mind.

Analysis: The impugned order recorded only a bare conclusion that the dispute regarding reversal of input tax credit remained sub judice and that the petitioner's reply was unsatisfactory, without identifying which outward supplies were taxable or exempted and without dealing with the petitioner's replies, supporting documents, or the CBIC circulars relied upon. The earlier departmental decision not to proceed on an identical issue for the previous financial year after considering the petitioner's reply was also not addressed. An adjudicatory order that confirms liability without giving reasons on the material issues and without considering the assessee's explanation cannot stand.

Conclusion: The impugned order was quashed for complete non-application of mind. The authorities were permitted to proceed afresh on the show cause notice only after considering all replies, granting a fresh opportunity of hearing, and acting in accordance with law.

Final Conclusion: The writ petition succeeded to the extent that the demand-confirming order was set aside, while the matter was left open for fresh adjudication by the department.

Ratio Decidendi: A tax adjudication order that fails to give reasons and does not meaningfully consider the taxpayer's replies and supporting material is vitiated for non-application of mind and cannot be sustained.

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