Preheat oven to 425°F.
Whisk together the flour, baking powder, baking soda, and salt.
Using a pastry cutter, two knives or your fingers cut butter into the flour mixture until a coarse mealy texture has been achieved.
Fold in the chiles and cheddar.
Add buttermilk and mix until the dough just comes together.
Form dough into an 8 to 10 inch disc about ½ inch thick.
Using a 2 inch circle cutter cut 16 biscuits and place onto a parchment lined baking sheet.
Bake for 16 to 20 minutes or until gold brown. Remove from oven and allow to cool slightly.
While the biscuits cool prepare the gravy: Melt 2 tablespoons butter in a saucepan over medium-high heat.
Add sausage and brown, about 4 minutes. Remove sausage from the pan and set aside.
Drain all but 1 tablespoon fat from the saucepan. Add remaining butter to pan and melt.
Whisk in flour until fully incorporated and continue to whisk, about 2 minutes.
Add milk to pan and continue to whisk until smooth and gravy begins to thicken, 3 to 4 minutes. Stir in pepper.
Add sausage back to pan and stir. Season with salt and serve warm over biscuits.