Adjudicating Authority's Inaction To Dispose Of Proceedings Can't Be Attributed To Taxpayer In Absence Of Any Malice On His Part: Bombay HC

The Bombay High Court ruled that inordinate delays in concluding show cause notices prejudice taxpayers. The case involved the Revenue Department’s investigation into undervaluation of imported cloves. The Adjudicating Authority took over 16 years to pass a final order after the CESTAT’s remand. The court found that such delays contravene procedural fairness and violate natural justice principles. The petitioners were not at fault for the delay, as they were granted limited opportunities to inspect documents. The court emphasized that the Revenue’s inaction could not be attributed to the petitioners, and the CESTAT’s directive to dispose of the proceedings within six months was ignored. The High Court quashed the Revenue’s order, highlighting the need for timely adjudication to ensure fairness in tax proceedings.