2021 (7) TMI 923 - HC - GST

Jurisdiction assigned to State Tax Officers in view of the decisions taken by the GST - Circular No. 01/2017 dated 20.09.2017 - constitutional body constituted under Article 279A of the Constitution of India - proceeding/ inquiry initiated by the Respondents against the Petitioner, legal or not - section 6(2)(b) of the Central Goods and Services Tax Act, 2017 - HELD THAT - This Court is of the view that as the Impugned Summons have been withdrawn and the inquiry proceedings have been closed, the issue sought to be adjudicated upon by the petitioner cannot be decided in a vacuum. Consequently the present writ petition and application are disposed of leaving the aforesaid question of law open to be decided in the event a fresh proceeding is initiated or summons are issued to the petitioner by the Central Tax Officers (GST Officers). The order be uploaded on the website forthwith.

Summary

Issues involved:
Jurisdiction of Central Tax Officers over Petitioner, Withdrawal of inquiry proceedings initiated against Petitioner, Validity of Impugned Summons dated 30.03.2021, Applicability of Circular No. 01/2017 dated 20.09.2017 by GST Council.

Jurisdiction of Central Tax Officers over Petitioner:
The petitioner sought a writ declaring that Central Tax Officers have no jurisdiction over them as State Tax Officers have the authority based on decisions by the GST Council. The respondent confirmed withdrawal of inquiry proceedings against the petitioner initiated through Impugned Summons dated 30.03.2021. The respondent's counsel shared communication indicating the closure of the inquiry due to confirmation of the amount by the State GST authority. The petitioner's counsel argued for a decision on the jurisdiction issue, but the Court noted that since the summons were withdrawn and proceedings closed, deciding the jurisdiction matter in isolation was not appropriate. The Court disposed of the petition, leaving the jurisdiction question open for future proceedings by Central Tax Officers.

Withdrawal of inquiry proceedings initiated against Petitioner:
The respondent informed the Court of withdrawing and closing the inquiry proceedings initiated against the petitioner through an Impugned Summons dated 30.03.2021. The communication shared by the respondent's counsel highlighted that the inquiry was based on an additional liability not disclosed in GST returns, which was later confirmed and deposited, leading to the withdrawal of the proceedings. The petitioner's counsel contended that Central Tax Officers had no jurisdiction over them, emphasizing the need for a decision on this matter. Despite the petitioner's insistence, the Court, considering the withdrawal of the summons and closure of proceedings, decided not to rule on the jurisdiction issue in the absence of an active case.

Validity of Impugned Summons dated 30.03.2021:
The Impugned Summons dated 30.03.2021 was issued for the recovery of a specific amount shown as additional liability in the GSTR-9C, which was not disclosed in GST returns. The respondent confirmed the withdrawal and closure of the inquiry proceedings related to this summons upon verification and confirmation of the amount by the State GST authority. The petitioner raised concerns regarding the jurisdiction of Central Tax Officers, seeking a declaration on the matter. However, the Court, acknowledging the withdrawal of the summons and closure of proceedings, refrained from addressing the jurisdictional dispute in the absence of an active case.

Applicability of Circular No. 01/2017 dated 20.09.2017 by GST Council:
The petitioner relied on Circular No. 01/2017 dated 20.09.2017 by the GST Council to support their argument that Central Tax Officers had no jurisdiction over them, as the authority was assigned to State Tax Officers. The respondent, while confirming the withdrawal of the inquiry proceedings, cited the circular and actions taken based on the liability disclosed in the GSTR-9C. The petitioner pressed for a decision on the jurisdiction issue, but the Court, considering the withdrawn summons and closed proceedings, opted not to address the jurisdictional matter in isolation, leaving it open for future proceedings by Central Tax Officers.