M/S Bhageshwari Paper LTD vs. State Of Up And Another

Held

The Court held that the summoning order dated 8.10.2025, passed by the Special Chief Judicial Magistrate, Meerut, was set aside. The Court noted the submission by the counsel for respondent no. 2 that the impugned order was passed without affording an opportunity of hearing to the applicants, which is contrary to the proviso of Section 223(1) of the BNSS. This section mandates that no cognizance of an offence shall be taken by the Magistrate without giving the accused an opportunity of being heard, unless specific exceptions apply, which were not detailed as being applicable here. Consequently, the matter was remanded back to the Chief Judicial Magistrate concerned for a fresh decision after hearing both parties. The applicants were directed to appear before the Magistrate on 25.5.2026.

Facts

The applicants are seeking to quash a summoning order dated 8.10.2025, passed by the Special Chief Judicial Magistrate, Meerut, in a complaint case initiated by the Union of India. The complaint was filed under Sections 9 and 9AA of the Central Excise Act, 1944, and CGST provisions. The Directorate General of Goods and Services Tax Intelligence had searched the premises of M/s Trikoot Iron and Steel Casting Limited (TISCL) and seized documents, including invoices issued by the applicants. Subsequently, a show cause notice was issued to TISCL and the applicants, leading to an adjudication order dated 30.6.2021 confirming duty demands and penalties. Appeals filed by the applicants and TISCL before the Tribunal were allowed on 8.5.2025, setting aside the duty demand and penalties. The applicants contend that since the adjudication order was set aside by the Tribunal and not challenged further, the summoning order under the Central Excise Act and CGST is not tenable.

Key Issues

1. Whether the summoning order dated 8.10.2025, passed by the Special Chief Judicial Magistrate, Meerut, is legally sustainable when the underlying duty demand and penalties have been set aside by the Tribunal in appeal. Petitioner's argument: The applicants argued that once the adjudication order, which formed the basis for the subsequent proceedings, was set aside by the Tribunal, the summoning order under Sections 9 and 9AA of the Central Excise Act, 1944, and CGST provisions is not tenable. They stated that to their knowledge, the Tribunal's order has not been challenged in a higher forum. Revenue's argument: The CGST counsel submitted that there is no requirement of giving an opportunity of hearing prior to issuing a summons under the CGST Act. However, the counsel for respondent no. 2 (Special Chief Judicial Magistrate) pointed out that the impugned order was passed without giving the applicants an opportunity of hearing, in contravention of Section 223 of the BNSS.