Case Law Details
Sai Auto Mobiles Vs Commissioner Central Goods Service Tax And Central Excise And 2 Others (Allahabad High Court)
The Allahabad High Court set aside an order dated 24.03.2026 passed under Section 74 of the CGST Act, 2017 after finding that the petitioner had not been supplied copies of the relied upon documents (RUDs) before confirmation of the demand. The petitioner contended that a specific application seeking copies of the RUDs had been submitted on 16.01.2026, but neither was the application rejected nor were the documents supplied. The petitioner also argued that certain double entries appearing in its accounts had been explained through its reply, but that explanation had not been considered by the adjudicating authority.
The Revenue raised a preliminary objection regarding the availability of the statutory appellate remedy. However, when the Court sought instructions on whether the RUDs had actually been supplied, no satisfactory instructions were produced.
The Court observed that when a demand is proposed on the basis of relied upon documents, the noticee’s ability to file a complete reply and effectively contest the proposed demand depends on access to those documents. Unless exceptional circumstances exist, copies of such RUDs must ordinarily be supplied before a demand is confirmed. Since no material was produced to establish that the documents had been provided and there were specific pleadings asserting non-supply, the Court inferred that the petitioner had not been furnished copies of the RUDs before the adjudication order was passed.
Accordingly, the Court set aside the impugned order and remitted the matter to the adjudicating authority for fresh consideration. The Court directed the authority to issue a fresh copy of the original show cause notice along with copies of the RUDs and a list of non-relied upon documents (non-RUDs) within two weeks. Upon receiving these documents, the petitioner was permitted to seek any additional documents, including copies of non-RUDs, within one week.
The Court further directed the adjudicating authority to consider such requests within one week and supply the requested documents within that period. If any request for documents or non-RUDs was to be rejected, adequate reasons were required to be communicated to the petitioner. Thereafter, the authority was directed to fix an appropriate date for further proceedings by giving at least fifteen days’ advance notice.
FULL TEXT OF THE JUDGMENT/ORDER OF ALLAHABAD HIGH COURT
1. Heard Sri Avneesh Tripathi, learned counsel for the petitioner and Sri Dhananjay Awasthi, learned counsel for the respondents.
2. Challenge has been raised to the order dated 24.03.2026 passed by the respondent no. 2 under Section 74 of the CGST ACt, 2017. Grievance is that the adjudicating authority has erred in passing the impugned order without first providing the petitioner copies of RUDs. Though, specific application had been made in that regard on 16.01.2026, neither that application has been rejected nor copy of RUDs was supplied.
3. Second, it has been urged that there was certain double entries in the accounts of the petitioner. The petitioner has explained the same through its reply. However, that issue has not been considered.
4. On the other hand, learned counsel for the revenue has raised preliminary objection as to the availability of statutory remedy of appeal.
5. Considering the nature of grievance, we required the learned counsel for the revenue to obtain instructions. Today, no satisfactory instruction has been received.
6. In view of above, we note that unless copies of RUDs are first made available to the noticee, his reply to the show cause notice may remain incomplete and his right to object to the proposed demand may remain impaired. Once the demand is proposed on the strength of RUDs, unless exceptional circumstance exists, supply of copies of such RUDs may remain mandatory on the revenue, before the proposed demand is confirmed.
7. To the extent, no satisfactory instruction has been received by the learned counsel for the revenue to establish that the copies of RUDs have been made available to the petitioner and in face of specific pleadings made in that regard, it has to be inferred, at this stage, the petitioner was not made available copies of the RUDs before the demand was confirmed.
8. Accordingly, the writ petition is disposed of with the following directions:
i. The impugned order dated 24.03.2026 is set aside and the matter is remitted to the adjudicating authority to pass a fresh order.
ii. For that purpose, the Adjudicating Authority may issue to the petitioner, a fresh copy of the original Show-Cause notice together with copies of RUDs and a list of non-RUDs. That compliance may be made within a period of two weeks from today.
iii. Upon receipt of such communication, the petitioner may apply to the Adjudicating Authority – to be supplied any other document including copies of non-RUDs, within a further period of one week therefrom.
iv. Subject to such compliance, the application moved by the petitioner may be considered by the Adjudicating Authority within a further period of one week. Copies of all other documents to be supplied to the petitioner may be made available within that time. If copy of any document or non-RUD, is to be declined, adequate reasons may be communicated to the petitioner, within that time.
v. Thereafter, the Adjudicating Authority may fix appropriate date in the proceeding with at least 15 days advance notice. The petitioner undertakes to cooperate in the proceedings and not seek any undue or long adjournment.
vi. At that stage, if the revenue seeks to rely on statement of any person, recorded during investigation etc., the same would necessarily be made available to the petitioner on the date fixed in the proceedings. On that date itself, the petitioner may apply for opportunity to cross-examine any witness being relied by the revenue.
vii. Wherever the revenue seeks to rely on adverse statement made against the petitioner, normally opportunity of cross-examination, if prayed for, may be allowed to the petitioner. If such opportunity is to be declined, adequate reasons for the same may be communicated to the petitioner within a week of its application.
viii. Accordingly, the proceedings may continue such that the same may be concluded within a period of six months from today, after affording due opportunity of personal hearing to the petitioner.
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