Central GST Authority cannot initiate proceedings when State GST Authority has already initiated proceedings on the same subject matter

[CA Bimal Jain]

The Hon’ble Gauhati High Court in the case of RAJESH MITTAL VERSUS UNION OF INDIA, THECOMMISSIONER CENTRAL GOODS AND SERVICES TAX, THE ASSISTANT COMMISSIONER CENTRAL GOODS AND SERVICE TAX, THE SUPERINTENDENT (ANTI EVASION) CENTRAL GOODS AND SERVICE TAX, THE PRINCIPAL COMMISSIONER STATE GOODS AND SERVICE TAX, THE ASSISTANT COMMISSIONER STATE GOODS AND SERVICE TAX - 2024 (2) TMI 127 - GAUHATI HIGH COURT  relying upon the provision of sub-clause (b) of sub-section (2) of Section 6 of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) stayed the proceeding initiated by the Revenue Department, thereby holding that, Central GST Authority should not have issued the SCN when State GST Authorities have already issued SCN on the same issue

Facts:

The Revenue Department (“the Respondent”) served a Show Cause Notice dated December 01, 2023 issued by the State GST Authorities and December 27, 2023 issued by Central GST Authority,(“the SCN”) to Rajesh Mittal (“the Petitioner”), stating that the Petitioner had wrongly availed the input tax credit (“ITC”) thereby violating the provisions of Section 16 (4) of the CGST Act for which reply was filed by the Petitioner.

Held:

The Hon’ble Gauhati High Court in the case of RAJESH MITTAL VERSUS UNION OF INDIA, THECOMMISSIONER CENTRAL GOODS AND SERVICES TAX, THE ASSISTANT COMMISSIONER CENTRAL GOODS AND SERVICE TAX, THE SUPERINTENDENT (ANTI EVASION) CENTRAL GOODS AND SERVICE TAX, THE PRINCIPAL COMMISSIONER STATE GOODS AND SERVICE TAX, THE ASSISTANT COMMISSIONER STATE GOODS AND SERVICE TAX - 2024 (2) TMI 127 - GAUHATI HIGH COURT  relying upon the provision of sub-clause (b) of sub-section (2) of Section 6 of the CGST Act, stayed the proceedings initiated by the Respondent on the ground that, Central GST Authority should not have issued the SCN when State GST Authorities have already issued SCN on the same issue.

Relevant Provisions:

Section 6 (2)(b) of CGST Act

“Section 6(2)(b): Authorisation of officers of State tax or Union territory tax as proper officer in certain circumstances

(2) Subject to the conditions specified in the notification issued under sub-section (1),

(b) Where a proper officer under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act has initiated any proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act on the same subject matter.”

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