High Court: Show cause notices under Sales Tax Act violated natural justice; fresh notices ordered

The High Court found that the show cause notices issued under the Tamil Nadu General Sales Tax Act, 1959 were done so with a closed mind, violating principles of natural justice. The Court held that directing the third respondent to consider objections impartially was insufficient, as any response to the notices would be futile if issued with a foreclosed mind. Citing precedents, the Court determined that the impugned notices indicated a prejudged mind, necessitating intervention. The Court allowed the writ appeals, setting aside the Single Judge's order and directing the third respondent to issue fresh notices without bias, with the petitioner retaining the right to challenge them if needed.

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Issues:
1. Challenge to show cause notices under Section 16 of the Tamil Nadu General Sales Tax Act, 1959.
2. Allegation of third respondent abdicating powers by copying notice issued under the Central Excise Act.
3. Whether the impugned show cause notices were issued with a closed mind.
4. Violation of principles of natural justice in the issuance of show cause notices.

The judgment involves the challenge to show cause notices under the Tamil Nadu General Sales Tax Act, 1959. The petitioner contended that the third respondent issued the notices with a closed mind, violating the principles of natural justice. The learned Single Judge found the drafting of the notices improper but opined that directing the third respondent to consider objections impartially would suffice. The petitioner argued that any response to the notices would be futile if issued with a foreclosed mind. The High Court cited precedents where show cause notices issued with a closed mind were deemed to violate natural justice. The Court held that the impugned notices clearly indicated a prejudged mind, warranting interference. The judgment referenced cases where biased issuance of notices led to interference by the courts due to violation of natural justice principles.

The Court referred to various judgments highlighting the importance of maintaining an open mind while issuing show cause notices to ensure adherence to natural justice principles. The petitioner's argument that directing the third respondent to proceed impartially would not rectify the vitiating factor was upheld. The Court emphasized that a show cause notice must genuinely solicit a response and not be issued with preconceived notions. The judgment clarified that if a notice reflects a closed mind, it violates natural justice, warranting intervention. The Court allowed the writ appeals, setting aside the Single Judge's order and directing the third respondent to issue fresh notices without the infirmity, granting the petitioner the liberty to challenge them if necessary.

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