Remove outer skin of chilies. Slit one side and remove the veins and seeds and place chilies on a baking sheet 5"-6" from broiler. Set oven to 450 degrees and leave oven door open.
Turn chilies while they cook and let them blister (do not burn) evenly. Remove from oven and plunge immediately into ice water. Peel stem downward and remove the rest of the seeds.
Stuff chilies with cheese. Don`t break chilies. Mix flour, salt, and pepper. Add milk, cooking oil and eggs until a smooth batter is formed. Let stand for 2 hours.
Then roll chilies in batter and fry in hot cooking oil, turning until evenly brown. Drain, serve with red chili sauce.
For chili sauce; blend cooking oil, flour, garlic, cook until mixed well. Add chili powder, water, and salt and stir over moderate heat until completely combined and slightly thickened. Pour over chili rellenos and serve.