Non-Supply of Relied-Upon Documents Before GST Adjudication Violates Natural Justice

The Allahabad High Court has reaffirmed an important principle in GST adjudication: if the department relies on documents to confirm a demand, the taxpayer must be given copies of those documents before the final order is passed.

Case Details

Case: Sai Auto Mobiles v. Commissioner Central Goods Service Tax and Central Excise

Court: High Court of Allahabad

Citation: WRIT TAX No. 2698 of 2026

Date of Order: 29 May 2026

Relevant Provision: Section 74 of the CGST Act, 2017

Background of the Case

The petitioner challenged a GST demand order dated 24 March 2026 passed under Section 74 of the CGST Act, 2017.

The main grievance of the petitioner was that copies of the Relied-Upon Documents (RUDs) were not supplied despite a specific request made on 16 January 2026. The department neither rejected the request nor provided the documents before passing the demand order.

The petitioner argued that without access to the documents relied upon by the department, it could not effectively reply to the show cause notice or contest the proposed demand.

Court’s Observation

The Allahabad High Court observed that when a demand is proposed on the basis of RUDs, the taxpayer must be supplied copies of those documents before the demand is confirmed.

The Court held that non-supply of RUDs impaired the petitioner’s right to file an effective reply and violated the principles of natural justice.

Since the revenue could not show that the documents had actually been supplied, the Court found the adjudication process to be flawed.

Decision of the Court

The High Court:

• Set aside the GST demand order dated 24 March 2026

• Remanded the matter back to the adjudicating authority

• Directed the authority to provide the show cause notice along with copies of RUDs and a list of non-RUDs

• Directed that the petitioner should be given a proper opportunity of hearing before fresh adjudication

Key Takeaways for Taxpayers

This judgment is important for businesses facing GST notices and adjudication proceedings.

Taxpayers should note that:

• If the department relies on documents, copies should be requested in writing

• A reply to the show cause notice should mention non-supply of RUDs, if applicable

• Demand orders passed without supplying relied-upon material may be challenged on the ground of violation of natural justice

• Proper documentation of requests and submissions is essential in GST litigation

Conclusion

The ruling reinforces that GST adjudication must be fair, transparent, and based on due opportunity of defence. Taxpayers should carefully review show cause notices and ensure that all relied-upon documents are obtained before submitting a detailed reply.

For expert guidance on this topic, contact your tax professional today.