the essay of 20 May 2026 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=utf-8"> </head> <body bgcolor="#FFFFFF"> <p align="center"><font color="#FF6633" face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong> When Seized Files Go Missing - Part II</strong></font></p> <div><p><strong><font color="#663399" face="Verdana, Arial, Helvetica, sans-serif" size="2">MAY 20, 2026 </font></strong></p><p align="center"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong><u>By Vijay Kumar</u></strong></font></p></div> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong>PLEASE</strong> take the trouble of Reading <a href="https://taxindiaonline.com/news/jest_gst/details?id=54475" target="_blank"><strong>Jest GST 435 dated 13 05 2026</strong> </a> (Last week's column) again just for brushing up our memory. I know asking you to reread a document from last week is a tall order. In the fast-paced, notification-heavy world of the Goods and Services Tax (GST), last week's news is practically archaeological data. But humour me, because the saga of the 14 missing files is a modern-day epic that deserves its own place in the pantheon of bureaucratic folklore. And some readers insisted that I should report about what happened in the Supreme Court on 13th May 2026. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Last week, we ended with: </font></p> <blockquote><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">The Supreme Court wanted to know on which date these 14 files seized in physical form were digitized and in what manner. </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">The Court requested the learned ASG to file a short affidavit in this regard of a responsible Officer who can say something as regards the entire exercise of physical copies being digitized is concerned and also provide with the index of the documents which were digitized. </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">The matter is posted for 13-5-2026. </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">We will know what the Supreme Court decides when seized files go missing from the Department. </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">But why and how do files go missing? </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#d1d1e7">In India, justice is never missing - only the evidence is. Files vanish like monsoon clouds: they thunder, disappear, and return as damp photocopies. They seem spiritual - existing in flesh during raids, attaining nirvana in custody, and reincarnating as low-resolution PDFs. </font></p></blockquote> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">We ended with a cliffhanger like top-tier streaming platforms. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The Supreme Court of India wanted to know on which date these 14 files, seized in physical form, were digitized and in what manner. To unravel this mystery, the apex court requested the learned Additional Solicitor General (ASG) to file a short affidavit. But they didn't just want any piece of paper. They specifically requested the affidavit <em>of a responsible Officer </em> - a phrase that in itself could cause a minor panic in the corridors of the Department, as "responsibility" is a luxury few bureaucratic budgets can afford. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The matter was posted for 13-5-2026. We promised we would know what the Supreme Court decides when seized files go missing. Today, we pull back the curtain on that fateful day in court, while exploring the profound philosophical question: Why and how do files go missing in the first place? </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Files in a government department do not behave like objects governed by standard Newtonian physics. They are deeply spiritual entities. They follow a distinct karmic cycle: </font></p> <div><table align="center" border="1" cellpadding="3" cellspacing="0" style="width:90%"> <tbody> <tr> <td colspan="4" style="vertical-align:top"> <div align="justify"><font color="#ffffff" face="Verdana, Arial, Helvetica, sans-serif" size="2">THE SEIZED FILE LIFE CYCLE </font></div> </td> </tr> <tr> <td align="justify" style="vertical-align:top"><font color="#ff0000" face="Verdana, Arial, Helvetica, sans-serif" size="2">Raid Phase </font></td> <td align="justify" style="vertical-align:top"><font color="#ff0000" face="Verdana, Arial, Helvetica, sans-serif" size="2">Custody Phase </font></td> <td align="justify" style="vertical-align:top"><font color="#ff0000" face="Verdana, Arial, Helvetica, sans-serif" size="2">Litigation Phase </font></td> <td align="justify" style="vertical-align:top"><font color="#ff0000" face="Verdana, Arial, Helvetica, sans-serif" size="2">Afterlife Phase </font></td> </tr> <tr> <td align="justify" style="vertical-align:top"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">In flesh </font><font face="Verdana, Arial, Helvetica, sans-serif" size="2">(Hefty & Physical) </font></td> <td align="justify" style="vertical-align:top"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Nirvana </font><font face="Verdana, Arial, Helvetica, sans-serif" size="2">(Pure Void) </font></td> <td align="justify" style="vertical-align:top"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Reincarnation </font><font face="Verdana, Arial, Helvetica, sans-serif" size="2">(Low-Res PDF) </font></td> <td align="justify" style="vertical-align:top"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Folklore </font><font face="Verdana, Arial, Helvetica, sans-serif" size="2">(permanently lost) </font></td> </tr> </tbody></table></div> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong>The Raid Phase (In Flesh): </strong>During a search and seizure operation, files exist vividly in the physical realm. They are heavy, bound in thick cardboard, smelling of old paper and anxiety. Officers carry them out of the taxpayer's premises with the triumphant air of warriors carrying trophies from a conquered kingdom. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong>The Custody Phase (Nirvana): </strong>Once they enter the Department's almirahs, the files undergo a metaphysical transformation. They attain <em>nirvana </em> - a state of perfect emptiness, liberation from the cycle of suffering, and total invisibility to the human eye. They detach themselves from the material world. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong>The Litigation Phase (Reincarnation): </strong>When a judge demands to see them, they reincarnate. But because reincarnation is a flawed process, they do not return in their glorious original physical forms. Instead, they return as low-resolution, highly pixelated PDFs where the crucial numbers could conveniently be obscured by a stray digital smudge. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2"><strong>The Afterlife Phase (Folklore) </strong></font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">When all hope fades, the files transcend even the digital realm. They become legends whispered in departmental corridors - stories of “those 14 files" that once held truth, now immortalized in audit folklore. Clerks speak of them in hushed tones, like mythical relics lost to time. Occasionally, a new officer vows to find them, only to discover that the files have achieved bureaucratic moksha - freedom from retrieval, accountability, and earthly existence. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Where there are files, disappearance is not an accident but an inevitability. Our record rooms are less about safekeeping and more about hide - and - seek arenas - cobweb museums where a document from 2024 demands not just a search but a survival kit: a map, a flashlight, and a truce with the resident rodents. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">What happened in the Supreme Court on 13th May 2026? </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The Supreme Court noted a rather breathtaking institutional paradox :<strong> <a href="https://taxindiaonline.com/caselaw/todays_case_indirect_tax/details?id=192897&type=caselaw" target="_blank">2026-TIOL-25-SC-GST</a></strong></font></p> <blockquote><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#dff3cb">the position today is that final orders of assessment have been passed by the competent authority with respect to the liability of the petitioner as alleged. We only need to consider whether the petitioner could be said to be seriously prejudiced in the course of assessment proceedings in the absence of the 14 files which have gone missing. </font></p></blockquote> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Let that profound reality sink in. While the taxpayer was busy going around courts, frantically knocking on doors and shouting, "Hey, you lost the evidence that proves my innocence!", the Departmental authorities were busy as bees. They were writing long, laborious orders, calculating tax, interest, and penalties against him, notwithstanding the fact that 14 files were missing. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The Supreme Court observed this administrative comedy of errors with absolute clarity: </font></p> <blockquote><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#dff3cb">the case of the petitioner is that if he would have been in possession of the 14 files, he could have established his case accordingly whereas the case of the Department is that these 14 files are even otherwise not relevant and not a single document of those 14 files have been relied upon in the assessment proceedings. </font></p><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#dff3cb">The petitioner has reached a stage wherein it is now left with no other option but to prefer statutory appeal under Section 107 of the Goods and Services Tax Act, 2017. </font></p></blockquote> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">This is a masterclass in bureaucratic gaslighting. First, the Department seizes those 14 files believing them to be absolutely critical to unearthing a massive tax fraud. They seize them with great fanfare. Then, they lose them. And, they smile blandly and say, "Oh, those 14 files? We looked at them before they evaporated, and honestly, they weren't even that interesting. We didn't use a single page. Trust us, your Honor, we did the taxpayer a favour by losing them." </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">What does a taxpayer do when the Department loses the very records that could clear his name? </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">In the peculiar facts and circumstances of this case, the Supreme Court relegated the taxpayer to the remedy of preferring statutory appeals with respect to each of the assessment orders before the appellate authority after a pre-deposit of 5% of the total principal tax amount. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">In the normal course, he would have been required to pay a pre-deposit of 10%, but the Supreme Court reduced it to 5%. And he was given four weeks time to make his appeals with pre-deposit @ 5% of the principal tax amount. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">But what happens to the 14 files lost by the Department? Does a new search party enter the scene? Not really! </font></p> <p align="justify"><img src="https://admin.taxindiaonline.com/UploadedFiles/Customs/CaseLaws/2026/je195261.JPG" style="height:264px; width:180px"/></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The Supreme Court ordered: </font></p> <blockquote><p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2" style="background-color:#dff3cb"><em>"it shall be open for the petitioner to raise this contention before the appellate authority in accordance with law."</em></font></p></blockquote> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The appellate authority can at best hold that serious prejudice has been caused to the taxpayer because the Department lost his files and most probably will hold that serious prejudice has NOT been caused. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">The files are still missing. God only can find them. And frankly, God is far too busy managing galaxies to look for misplaced cardboard folders in a State GST office. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">If there are files, they can go missing - in fact, evidence itself can vanish, thanks to storage facilities that are anything but foolproof. In the film <em>Drishyam 2 </em>, the hero replaces the skeletal remains of a dead boy with the help of a drunken watchman. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">A Departmental officer commented on my column that sometimes the taxpayers cause the files to go missing. And you know what? He has a point. So, files can go missing because of genuine lack of infrastructure or they can be -- <em>facilitated </em> to go missing. So, when officers come and seize records, one of the contingencies to be planned is what to do if the files go missing. </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Is there any chance of getting back the missing files? Well, they didn't go missing just to be found easily by a snoopy investigator or a desperate taxpayer . </font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">And will the portal accept the 5% pre-deposit? </font></p> <p align="justify"><font color="#ff0000" face="Verdana, Arial, Helvetica, sans-serif" size="2">Until next week</font></p> <p align="justify"><font face="Verdana, Arial, Helvetica, sans-serif" size="2">Comments/feedback welcome at <a href="mailto:vijaywrite@tiol.in">vijaywrite@tiol.in </a> or 9848111243 (WhatsApp) </font></p> </body> </html>