Authority: High Court of Judicature at Bombay, Civil Appellate Jurisdiction

Order Date: 12 October 2026 (pronounced)

Case Overview

  • Petition No. 9256 of 2026 filed by Bhagyoday Agro Industries (Petitioner) against Commissioner (Appeals) CGST & Central Excise and other respondents.
  • The petitioner is registered under the CGST Act and trades in cotton. GST officers of the Directorate General of Goods and Service Tax Intelligence, Nashik Region, alleged non‑payment of GST under the Reverse Charge Mechanism (RCM) on purchase of rock cotton from agriculturists.
  • A search under Section 67 of the CGST Act quantified the GST liability on RCM to ₹14,77,57,828. A show‑cause notice was issued and the Adjudicating Authority confirmed the demand on 28 October 2024, also fixing a pre‑deposit amount of ₹1,50,00,000.
  • The petitioner filed an electronic appeal on 3 February 2025. The Appellate Authority rejected the appeal on 19 May 2026, confirming the original order of the Additional Commissioner, CGST & CX Aurangabad.
  • The petitioner contended that the appellate authority ignored the fact that the ₹1,50,00,000 pre‑deposit had already been made, which exceeded the statutory pre‑deposit requirement per Circular dated 11 July 2024, and that no defect‑memo, notice or hearing was provided, violating natural justice.
  • Counsel for the petitioner (Mr. Parth Parikh, Ms. Samikshya Chatur, Mr. Yash Prakash) argued the gross violation of principles of natural justice. Counsel for the revenue (Mr. Jitendra B. Mishra, Ms. Sangeeta Yadav, Mr. Umesh Gupta) maintained that the order was correct.

Final Outcome

  • The writ petition is allowed.
  • The order dated 19 May 2026 passed by the Commissioner (Appeals), CGST & Central Excise, Nashik (Proceeding No. NSK/GSP/000/APPL/52/2026‑2027) is quashed and set aside.
  • The Commissioner (Appeals) is directed to grant a fresh hearing to the petitioner, specifically on the pre‑deposit issue.
  • The appellate authority must decide the proceedings within 12 weeks from the date this order is produced.
  • The authorized representative of the petitioner must appear before the authority on 21 October 2026 at 11:00 a.m.; thereafter the appellate authority will commence further proceedings.
  • All contentions of the parties on the merits are kept open.

Topics: GST, Natural Justice