Supreme Court Relegates GST Assessee to Appellate Remedy Under Section 107 — Missing Seized Files Grievance Reserved for Appellate Authority
Background and Overview
The Supreme Court of India recently delivered a significant ruling in Bengal Cold Rollers Private Limited Vs Assistant Commissioner (ST) & Ors., addressing a complex situation arising from GST assessment proceedings where the assessee alleged that 14 seized files had gone missing from departmental custody. The Court, taking stock of the fact that final assessment orders had already been issued for all relevant assessment years, directed the assessee to avail the statutory appeal mechanism under Section 107 of the Goods and Services Tax Act, 2017, rather than continuing to pursue writ remedies before constitutional courts.
This decision carries important implications for assessees facing similar circumstances — particularly those whose assessment proceedings have concluded and who seek to challenge both the substantive tax liability as well as procedural irregularities allegedly committed during the course of adjudication.
Genesis of the Dispute: Search, Seizure, and Missing Files
The controversy had its origins in a departmental search and seizure operation carried out on 26.12.2023 at the business premises of Bengal Cold Rollers Private Limited. During the search, officers of the State Tax Department seized numerous files and documents from the assessee's office.
Following the search, assessment proceedings were initiated against the assessee for assessment years 2019-20 through 2023-24 under Section 74 of the GST Act. The assessee, however, raised a serious grievance — alleging that 14 of the seized files, which purportedly contained crucial business records including invoices and related documentation, had gone missing while they remained in the custody of the Department.
The assessee's central contention was straightforward but significant: without access to copies of those 14 missing files, it was practically impossible to prepare a comprehensive and effective response to the show cause notices issued by the Department. The assessee further argued that the missing files were directly relevant to rebutting departmental allegations concerning fraudulent transactions and bogus invoices.
Proceedings Before the Telangana High Court
The Assessee's Challenge
Aggrieved by the Department's insistence on proceeding with adjudication despite not furnishing copies of the missing seized documents, the assessee filed a writ petition before the High Court for the State of Telangana. The writ sought to challenge the issuance of a Reminder Notice cum Personal Hearing dated 26.02.2026, which directed the assessee to participate in adjudication for assessment years 2019-20 to 2023-24 (up to December 2023).
The assessee's prayer before the High Court included:
- A declaration that the Department's insistence on proceeding with adjudication without furnishing the missing documents was illegal, arbitrary, and contrary to
Section 67(5)of the GST Act, 2017 - A direction to drop all proceedings initiated under
Section 74of the GST Act on account of the Department's failure to furnish the 14 missing files - A stay on all further proceedings, including recovery proceedings, pending disposal of the writ petition