Restoration of show cause notice after ex parte order: respondent given opportunity to reply before merits are examined.

An ex parte Order-in-Original passed pursuant to a show cause notice under Section 74 was set aside, and the show cause notice was restored so the respondent could file a reply and the proper officer could consider the matter on merits. The Karnataka HC followed its earlier approach on the same issue and found it appropriate to give the respondent an opportunity of hearing before further adjudication. Four weeks were granted to submit the reply.

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Issues: Whether the order quashing the Order-in-Original and show cause notice should be set aside and the show cause notice restored with liberty to the respondent to file a reply.

Analysis: The appeal followed an earlier decision on the same issue and the Court applied the same approach. The Order-in-Original had been passed pursuant to a show cause notice under Section 74 and it had been passed ex parte. The Court considered it appropriate to restore the show cause notice and to grant the respondent an opportunity to respond before the proper officer considers the matter on merits.

Conclusion: The challenge to the quashing order succeeded, the Order-in-Original was set aside, the show cause notice was restored, and the respondent was granted four weeks to file a reply.

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