RT-12 endorsement cannot replace a show cause notice; demands for short levy require proper Section 11A notice.

An endorsement on RT-12 returns directing payment is not a valid substitute for a statutory show cause notice under Section 11A. Because such an endorsement does not give the assessee an opportunity to reply or be heard, it cannot sustain a demand for short levy or non-levy. The Tribunal followed Supreme Court authority and its earlier Special Bench view in holding that demands must be raised through proper notice under Section 11A, and that an RT-12 endorsement by itself neither validates the demand nor saves it from limitation. The department's appeals were therefore dismissed as unsustainable.

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Issues: Whether demands raised merely by endorsement on RT-12 returns, without a proper show cause notice under Section 11A, were legally sustainable and could save limitation.

Analysis: The Tribunal held that an endorsement on RT-12 returns directing payment is not the same as a notice to show cause. Even if reasons are recorded, such an endorsement does not afford the assessee an opportunity of reply or hearing and therefore cannot be treated as a valid statutory notice. Following the binding Supreme Court authority and the Tribunal's earlier Special Bench view, the Tribunal concluded that a demand for short levy or non-levy must be made through a proper notice under Section 11A, and an RT-12 endorsement by itself does not validate the demand or protect it from limitation.

Conclusion: The department's appeals were held to be unsustainable and were dismissed.

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