M/S Ink Fruit Through Its Partner Praveen Ajmera vs. The Union Of INDIA

Held

The Court allowed the writ petitions (except WP No. 17609/2025) and quashed the impugned order dated 05.02.2025. The Court held that the adjudicating authority was wholly unjustified in refusing to extend the reliefs granted in the Elora Tobacco case to the present petitioners. The Court emphasized the doctrine of judicial discipline and propriety, stating that once the High Court had directed the opportunity for cross-examination and return of documents for one noticee, the authority ought to have followed the same for other noticees facing similar show cause notices. The Court rejected the revenue's contention that the Elora Tobacco order was merely 'in personam', finding it irrelevant to the issue of judicial discipline. The matters were remanded back to the adjudicating authority to pass a fresh order after returning all unrelied documents to the petitioners, allowing them 30 days to file a fresh reply, and affording them an opportunity for cross-examination of witnesses. The Court explicitly stated that it had not expressed any opinion on the merits of the case. For WP No. 17609/2025, the petition was dismissed as the petitioner did not appear before the authority, nor did they make any application for return of documents or cross-examination, and was granted liberty to pursue available remedies.

Facts

Multiple writ petitions were filed challenging orders-in-original confirming GST demands. In WP No. 12375/2025, M/s. Dabang Dunia Publications Private Limited challenged an order dated 05.02.2025 passed by the Joint Commissioner, Central GST, Indore, confirming a GST demand of Rs. 151,64,38,832/- and Compensation Cess of Rs. 1794,58,34,178/-. The petitioner contended that the order was passed in violation of natural justice, as it was denied adequate opportunity to defend its case, including access to non-relied upon documents and the right to cross-examine witnesses. The proceedings were based on allegations of tax evasion by M/s Elora Tobacco, with the petitioner allegedly facilitating money laundering. The petitioner highlighted a previous High Court order in the case of M/s Elora Tobacco, which granted similar reliefs regarding document return and cross-examination.

Key Issues

1. Whether the adjudicating authority was justified in denying the petitioner access to non-relied upon documents and the right to cross-examine witnesses, thereby violating principles of natural justice, in light of the High Court's prior order in M/s Elora Tobacco Company Limited v. Union of India? Petitioner's Arguments: The petitioner argued that the impugned order was passed in gross violation of natural justice and in disregard of the High Court's order in the Elora Tobacco case. They contended that they were denied a reasonable opportunity to defend themselves, specifically by not being provided with non-relied upon documents and not being allowed to cross-examine witnesses whose statements formed the basis of the allegations. They relied on the High Court's order in Elora Tobacco, which directed the return of non-relied upon documents and permitted cross-examination, and argued that this principle should apply to them as well, citing judicial discipline. Revenue's Arguments: The revenue contended that the order passed in the case of Elora Tobacco was a judgment 'in personam' and not 'in rem', and therefore, it was not binding on the present petitioners. They argued that the adjudicating authority was justified in holding that the Elora Tobacco judgment would not apply to other noticees.