M/S Jindal Metal Co. And Another vs. Union Of INDIA And 3 Others

Held

The Court held that no useful purpose would be served by keeping the writ petition pending or calling for a counter-affidavit at that stage. The Adjudication Order dated 22.12.2025 was set aside. The matter was remitted to the adjudicating authority to pass a fresh order. The adjudicating authority was directed to issue a fresh copy of the show-cause notice along with copies of RUDs and a list of non-RUDs to the petitioner within two weeks. The petitioner would then have one week to apply for any other documents, including non-RUDs. The adjudicating authority was to consider these applications and supply documents within a further week, providing reasons if any document was declined. The proceedings were to continue with at least 15 days' advance notice, with the petitioner undertaking to cooperate. If the revenue relied on statements, they were to be made available, and the petitioner could apply for cross-examination. Opportunity for cross-examination was to be allowed unless adequate reasons for denial were communicated within a week. The proceedings were to conclude within six months, affording due opportunity of personal hearing.

Facts

The petitioners, M/s Jindal Metal Co. and Another, challenged an Adjudication Order dated 22.12.2025, passed by respondent no. 4 under Sections 74 and 122 of the CGST Act, 2017. The petitioners argued that their case was not being considered, and despite filing a reply to the show-cause notice and having their statement recorded, the order dismissed their individual case and confirmed the demand of penalty without reciting their explanation. Similar cases arising from the same impugned order were also pending. The revenue sought time to obtain instructions. Subsequently, the revenue stated that in view of the petitioner's ground and the fact that similar matters for co-noticees were remitted, the present petition could also be disposed of similarly.

Key Issues

1. Whether the Adjudicating Authority failed to consider the explanation furnished by the petitioner while passing the Adjudication Order dated 22.12.2025, thereby violating principles of natural justice, as contemplated under the CGST Act, 2017? Petitioner's Argument: The petitioner contended that their explanation and statement were not properly considered, and the Adjudicating Order merely confirmed the demand and penalty without addressing their submissions. They relied on the principle that all contentions raised must be dealt with by the adjudicating authority. Revenue's Argument: The revenue, upon instructions, conceded that the matter could be remitted to the Adjudicating Authority, acknowledging the petitioner's grounds and the similar treatment given to co-noticees. No specific statutory provisions or precedents were cited by the revenue in their argument.