A common concern in GST adjudication is that the Appellate Authority under Section 107 of the CGST Act cannot remand a matter back to the adjudicating officer, leaving an aggrieved taxpayer with no recourse if the original hearing was procedurally defective — particularly where cross-examination of witnesses was denied. The Delhi High Court has addressed this concern directly, holding that the bar on remand in Section 107(11) does not prevent the Appellate Authority from itself conducting further inquiry, including directing cross-examination where the ends of justice require it.
The case arose from an assessment order raising a demand of approximately ₹64 crore against M/s DK Enterprises on the ground of wrongful availment of Input Tax Credit through fake invoices. The petitioner had already deposited ₹64 crore during the proceedings. It approached the Delhi High Court by way of a third writ petition — two earlier writ petitions having already been disposed of by relegating the petitioner to the statutory appeal remedy. The central argument this time was that since the Appellate Authority cannot remand under Section 107(11), there was no effective statutory remedy in a case where cross-examination had been denied at the adjudication stage.
The bench of Justice Anil Kshetarpal and Justice Shail Jain read Section 107(11) carefully and rejected this contention. The provision states that the Appellate Authority shall, "after making such further inquiry as may be necessary," pass an order confirming, modifying or annulling the decision under appeal. The bar on remand is explicit. But the power to conduct "such further inquiry as may be necessary" is equally express — and the Court held that this phrase is sufficiently wide to encompass directing cross-examination of witnesses wherever the Appellate Authority considers it necessary for just adjudication. The Appellate Authority, sitting as the first appellate forum with full fact-finding powers, is not limited to the record as it stood before the adjudicating officer.
The Court also noted that the petitioner's separate grievance about the ₹64 crore deposit not being properly considered had been addressed in the impugned order, and the Appellate Authority was in any event fully competent to re-examine it. The writ petition was disposed of by relegating the petitioner to Section 107, with the period during which the writ was pending excluded from the limitation for filing the appeal. The ruling provides important practical guidance: taxpayers who were denied cross-examination at the adjudication stage need not treat their case as irretrievably compromised — the Appellate Authority has the power to remedy the defect.
-2026-juristway.com-2107-HC(Delhi)-GST | High Court of Delhi | 27.07.2026