Facts

M/s Earthmark Traders exported the goods and filed the refund application under FORM RFD-01 on the account of exports. With regard to the said application, the proper officer made a visit to the premises of the appellant and upon inspection issued a memo with various allegations. The appellant submitted a detailed reply along with the documents against the allegations made under the memo. The adjudicating authority passed the order and being aggrieved from the order the petitioner filed an appeal before the Joint Commissioner who rejected the appeal on the ground that the appellant has not proved the claim of export of goods.

Being aggrieved from the order of the appellant authority, the petitioner filed a writ petition before the Hon’ble High Court of Calcutta.

Issues

Whether the Appellate Authority can pass an Order that is beyond the accusations made in FORM RFD-08, i.e., Show Cause Notice or not?

Also Read: Madras High Court Ruling on Refund of Unused Input Tax Credit Due to Inverted Duty Structure.

Observation

The Hon’ble High Court held that in any situation, the appellate authority cannot travel beyond the assertions of the show cause notice as pointed out earlier. The Court held the show cause notice as defective on account of non-consideration of the reply and the documents that were produced by the appellant along with the response to the said show cause notice.

Judgement

The Hon’ble Court quashed the order passed by the appellate authority and remanded back the matter to the original authority. The Hon’ble Court emphasized that the authority should take into account the complete submission made by the petitioner along with the documents submitted in response to the Memo. It was also directed by the Court that the matter must be heard out afresh after giving an adequate opportunity of hearing to the appellant and it should be decided on the merits and in accordance with law without being influenced by any of the observations made by him earlier or any other authority.

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