Adjudication orders passed without supplying Relied Upon Documents violate natural justice and must be remanded.

Adjudication orders passed without supplying Relied Upon Documents violate natural justice and must be remanded.

Issue

Whether a GST demand order passed under Section 74 can be legally sustained if the adjudicating authority fails to supply copies of the Relied Upon Documents (RUDs) to the taxpayer despite a specific application, thereby impairing their opportunity to file a complete defense reply.

Facts

• The Challenge: The petitioner, a registered person under the CGST regime, filed a writ petition challenging an administrative order that confirmed a tax demand against them.

• Request for Evidence: Prior to the final adjudication, the petitioner formally applied to the tax authorities requesting copies of the Relied Upon Documents (RUDs) used to build the case.

• Failure to Supply: The tax department failed to decide on the petitioner’s application and did not provide copies of the requested documents.

• Demand Confirmed: Despite the non-supply of these foundational documents, the adjudicating authority proceeded to pass the final order confirming the tax liability.

• Revenue’s Position: During the writ proceedings, the Revenue department was unable to produce any satisfactory evidence or instructions demonstrating that the RUDs had actually been delivered to the taxpayer.

Decision

• Impairment of Defense: The High Court held that without access to copies of the RUDs, a taxpayer’s ability to reply to a show cause notice is severely restricted, and their legal right to object stands critically impaired.

• Mandatory Disclosure: Since the tax demand was proposed strictly on the strength of specific underlying materials, supplying those exact documents is mandatory unless exceptional, legally recognized circumstances dictate otherwise.

• Order Set Aside: Because no material on record proved the documents were shared, the court inferred that natural justice was violated. The impugned demand order was set aside.

• Remand for Due Process: The matter was remitted back to the authority for a fresh adjudication with strict directions to supply all RUDs first and to grant a meaningful opportunity of being heard, including the cross-examination of witnesses whose adverse statements are relied upon.

Key Takeaways

• Core Element of Natural Justice: The right to a fair hearing inherently includes the right to know the evidence being used against you. Failing to provide the specific materials (RUDs) upon which a tax demand is structured invalidates the subsequent adjudication order.

• Right to Cross-Examination: When the tax department builds a demand using third-party recorded statements or adverse testimonies, the taxpayer has a legal right to cross-examine those individuals to test the veracity of the evidence.

• Procedural Fairness Rules: Revenue authorities cannot rush to finalize tax demands or penalty orders while withholding the foundational documents that triggered the inquiry in the first place.

HIGH COURT OF ALLAHABAD

Sai Auto Mobiles

v.

Commissioner Central Goods Service Tax and Central Excise^*

Saumitra Dayal Singh and Vivek Saran, JJ.

WRIT TAX No. 2698 of 2026

MAY  29, 2026