Denial of Cross-Examination of Witnesses by Authorities Would Render Proceedings as Void | HC

Case Details: Joint Commissioner vs. Nishad K.U. - [2025] 172 taxmann.com 557 (Kerala)

Judiciary and Counsel Details

• A.K. Jayasankaran Nambiar & Easwaran S., JJ.
• R. Harishankar, Adv. for the Petitioner.
• Jaikumar Seetharaman, Adv. for the Respondent.

Facts of the Case

The assessee contested an order issued under Section 74(9) of the CGST Act, 2017, which imposed tax and penalty, asserting that the proceedings were unfair due to the denial of cross-examination of witnesses whose statements formed the basis of the order. The single judge of the High Court acknowledged this concern, emphasizing that the right to cross-examine is fundamental to ensuring procedural fairness. Consequently, the order was set aside. The GST authorities appealed, maintaining that the CGST Act does not explicitly provide for cross-examination in adjudication proceedings and sought to reinstate the original order.

High Court Held

The Hon’ble High Court upheld the single judge’s decision, affirming that when an adjudication order relies on third-party statements, cross-examination is a fundamental right. The court underscored that denying this right compromises procedural fairness and renders the proceedings void, even if not expressly mandated by the statute. Emphasizing adherence to natural justice in proceedings under Section 74(9), the court concluded that the assessee was justified in seeking cross-examination and refused to interfere with the single judge’s decision.

List of Cases Reviewed

• Krishnadatt Awasthy v. State of M.P. & Ors. [2025 SCC Online 179]
• CIT & Ors v. Chhabil Dass Agarwal [2014 (1) SCC 603]
• Kothari Filaments and another v. Commissioner of Customs (Port) & ors. [(2009) 2 SCC 192]
• Aureliano Fernandes v. State of Goa & Ors. [(2024) 1 SCC 632], relied on
• Kanungo & Co. v. Collector of Customs & Ors. 1983 (13) ELT 1486 (SC), distinguished

List of Cases Referred to

• Surjeet Singh Chhabra v. Union of India 1996 taxmann.com 71/[1997] 89 ELT 646 (SC) (para 4)
• In Ayaaubkhan Noorkhan Pathan v. State of Maharashtra (2013) 4 SCC 465 (para 17)
• In Kothari Filaments and another v. Commissioner of Customs (Port) Kolkata and others (2009) 2 SCC 192 (para 21)
• In Aureliano Fernandes v. State of Goa and Others (2024) 1 SCC 632 (para 22).