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TMI Blog2014 (11) TMI 622X X X X Extracts X X X X X X X X Extracts X X X X ..... fore, they caught hold of the petitioner, when he applied for fresh registration certificate. Hence, the respondent has passed a non-speaking order without affording an opportunity of hearing to the petitioner, rejecting his claim. When the department having recognised those three as lessees, cannot claim the amount payable by them from the petitioner. If they are not recognised as lessees then the question is different. From the records produced it is seen that the name of three persons, in whose name registration certificate has been granted and they have been described as lessees of the tea factory. Therefore, if an opportunity for personal hearing had been granted to the petitioner, he would have placed all the records including the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing ECC Code 2586010984. Abruptly, those lessees abandoned the factory and so the petitioner was unable to run the business and the whereabouts of the lessees were not known. Therefore, with a view to commence business activities, the petitioner submitted an application 22.07.2009 for registration in Form A-1. The said application was not processed and therefore the petitioner had sent a representation on 23.08.2011. Ultimately, by order dated 12.09.2011 the petitioner's application for registration was rejected stating that an amount of ₹ 18,72,299/- is pending as arrears from the previous registrant and as per Section 11 of Central Excise Act 1944 the liability of paying the arrears of the predecessor falls on the successor an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the real meaning of 'business' and 'ownership of business' as provided under section 15 (1) of Karnataka Sales Tax Act. Further learned counsel for the petitioner referred to the decision of this Court in the case of Sri Jagajothi Co. Ltd. vs. Commissioner of Central Excise, Tirunelveli reported in 2011 (268) ELT 164 (Mad), stating that only if there is transfer of business or trade which effects any change in ownership thereof, and in consequent thereof one succeeds in such business, such person is liable to pay dues under proviso to Section 11 of the Act. Learned counsel also referred to the decision of Hon'ble Supreme Court in Rana Girders Ltd. vs. Union of India Ors. reported in CDJ 2013 SC 694, wherein it has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 77; 8,35,829/- has been claimed as basic excise duty apart from claim of cess and penalty. 6. After hearing learned counsel for the parties and perusing the material placed on record, the following points arise for consideration. Firstly, whether the respondent is justified in passing the impugned order to clear the dues of the predecessor without affording an opportunity of hearing to the petitioner. Secondly, whether the petitioner could be called upon to pay the dues liable to be paid by his lessees as a condition precedent to issue fresh registration certificate. Admittedly, the registration stood in the name of three persons, who are the lessees and even according to the department, two of them are absconding and one of them ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the respondent is directed to issue a show cause notice clearly stating as to the names under which registration was granted and how the respondent is claiming the sales tax dues alleged to have been defaulted by the lessees and on receipt of the show cause notice, the petitioner is entitled to submit his reply, after affording an opportunity of personal hearing to the petitioner, the respondent shall pass orders on merits and in accordance with law. During the course of enquiry, the petitioner is entitled to produce all the documents including the judgements relied upon. The said proceedings shall be completed by the respondent, within a period of four months from the date of receipt of a copy of this order. No order as to costs. - - T ..... X X X X Extracts X X X X X X X X Extracts X X X X
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