Opportunity to reply is essential before ex parte tax adjudication; disputed factual issues justified remand for fresh consideration.

An ex parte adjudication passed without considering the taxpayer's reply was set aside because the dispute involved contested factual issues on outward tax declaration and alleged short payment. The court held that where a meaningful opportunity to respond to the show-cause notice has not been given, the proper course is to restore the matter to the pre-adjudication stage. The adjudication order and demand notice were cancelled, and the taxpayer was allowed to file a reply and contest the matter afresh.

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Issues: Whether the ex parte adjudication order and consequential demand should be set aside and the matter remitted to the adjudicating authority for fresh consideration after granting an opportunity to file a reply to the show-cause notice.

Analysis: The impugned adjudication was passed without the benefit of the petitioner's reply, while the dispute turned on factual discrepancies regarding outward tax declaration and short payment. Since the petitioner asserted that the alleged discrepancy did not exist and that the matter required a response on merits, the appropriate course was to restore the proceedings to the pre-adjudication stage so that the petitioner could answer the show-cause notice.

Conclusion: The order of adjudication and the notice of demand were set aside, and the matter was remitted to the stage of reply to the show-cause notice for reconsideration. The petitioner was permitted to appear and file a reply, with all contentions kept open.

Final Conclusion: The petitioner obtained restoration of the matter for fresh adjudication, with the original ex parte decision displaced and the dispute reopened at the notice stage.

Ratio Decidendi: Where an adjudication is made without affording a meaningful opportunity to reply on disputed factual issues, the order may be set aside and the matter remitted for fresh decision after hearing the affected party.

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