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TMI Blog2025 (2) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... d Midwives Council for the period from 01.07.2017 to 31.03.2022, through their letter in Ref. No.1538/NC/2022 dated 18.04.2022 is seen to have been communicated. Through another statement dated 14.06.2022, the legalities relating to taxability in the instant issue, is seen to have been discussed. Apart from the same, perusal of the Incident Report No. 89/2022 dated 24.06.2022 issued by the DGGI, Chennai Zonal Unit, clearly brings out the fact that the issue relating to non-payment of taxes under GST on the charges/fees collected by the appellant has already been taken up for investigation. An advance ruling is not required to be pronounced once an investigation is initiated against the appellant under the provisions of the CGST Act, or the GST Act of the respective State or Union Territory, involving the same issue on which the query for advance ruling has been raised, and accordingly, the application for advance ruling dated 28.06.2022 by the appellant is liable for rejection under the first proviso to Section 98 (2) of the CGST / TNGST Acts, 2017. Conclusion - The rejection of the advance ruling application upheld on the basis that the issue was already subject to an ongoing in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Service Tax Act, 2017. 2.1. The subject appeal was filed under Section 100(1) of the Tamilnadu Goods & Services Tax Act 2017/Central Goods & Services Tax Act 2017 (hereinafter referred to 'the Act') by M/s. Tamil Nadu Nurses and Midwives Council (hereinafter referred to as 'Appellant). The appeal was filed against the Advance Ruling No. 21/ARA/2024 dated 30.09.2024 passed by the Authority for Advance ruling, Tamilnadu. 2.2. The Appellant has stated that the Tamil Nadu Nurses and Midwives Council (hereinafter referred to as "Appellant") was formed under The Tamil Nadu Nurses and Midwives Act, 1926. It is an act to provide for registration of Nurses, Midwives, Health Visitors, auxiliary Nurse-Midwives and Dhais in the State of Tamil Nadu. The said Act vide Section 11, inter alia, provides for regulating the conduct of any examination which may be prescribed as a condition of admission to the register, and any matters ancillary to or connected with such examinations; determining the manner in which all fees levied under this Act and all moneys received by the Council shall be applied for the purposes of this Act. 2.3. Section 12 of the said Act, inter alia, provides for regula ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Thereby, the principles of natural justice was not followed in as much as they have not been extended an opportunity to comment on the submissions of DGGI with respect to Hon'ble Andhra Pradesh High Court order dated 23.11.2022, which states that issuance of summons under Section 70 of CGST Act, 2017, is the commencement of investigation/proceedings as per CGST Act, 2017. 2.5 Accordingly, the Appellate Authority for Advance Ruling, Tamilnadu, vide their Order-in Appeal No. AAAR/05/2023 (AR) dated 09.12.2023 remanded the matter back to AAR with a direction to forward the letter dated 03.04.2023 of DGGI alongwith its enclosures, if any, to the appellant enabling them to comment on the same, and to offer them another opportunity of personal hearing before deciding the case as per the provisions of law. 2.6 On communicating the relevant documents to the appellant, the AAR accorded an opportunity of personal hearing to the appellant and passed an order vide Advance Ruling No. 21/ARA/2024 dated 30.09.2024, wherein the advance ruling application filed was rejected under the first proviso to Section 98 (2) of the CGST / TNGST Acts, 2017, in view of the fact that 'proceedings' on the sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... India held that the term "investigation" means the process of collection of evidence or the gathering of material. It can be said that the term "Proceeding" has a larger scope than the term "investigation". It is not merely a process of collection of evidence, it includes only those actions that may result in a decision i.e., in nature of show cause notice or order. All other interim steps leading to such event are merely inquiries, investigations, etc., and are therefore not covered under the ambit of the term 'proceeding'. * The Hon'ble Supreme Court in Radha Krishna Industries v. State of Himachal Pradesh and Ors clarified that the proceeding commences from the issuance of a Show Cause Notice (SCN) and concludes upon the passing of an adjudication order. Without issuing a show cause notice proceeding cannot be deemed to be started and once an adjudication order is passed, the proceeding is deemed to be concluded. * In G.K. Trading Company v. Union of India, the Hon'ble Allahabad High Court held that the term "proceeding" and "inquiry" are two different terms and they cannot be intermixed. Thus, the "inquiry" launched under section 70 of the CGST Act against the petitioner si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the appellate forum and contended that 'proceeding' takes effect only after the issuance of Show Cause Notice and reiterated the stand already stated in their reply. To the members query, the AR explained the nature of activity done by them and the amount of fees being collected from the beneficiary for such activity. DISCUSSION AND FINDINGS 5.1 We have carefully considered the submissions made by the appellant in the advance ruling application, the submissions made during the personal hearing, and the 'grounds of appeal' furnished alongwith the application for appeal by the appellant. The appellant filed advance ruling application for determination of the liability to pay tax on service involving collection of various fees by them, which is covered under Section 97 (2) (e) of GST Act, 2017, i.e., determination of the liability to pay tax on any goods or services or both. However, while examining the application of the appellant in terms of Section 98 (2), it was noticed that an investigation has already been initiated by DGGI, Chennai Zonal Unit, in respect of the questions raised in the application in the instant case. The relevant provisions of Section 98 (2) of the CGST A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nbsp;proceedings Penalty for certain offences - "furnishes false information or documents during any proceedings under this Act" 160 (1) Other proceedings Assessment proceedings not to be invalid on certain grounds - "No assessment, re-assessment, adjudication, review, revision, appeal, rectification, notice, summons or other proceedings" 5.3 From the above, it could be seen that Section 66 of the CGST Act, 2017, that talks about 'Special Audit', specifies in sub-section 1 of Section 66 as follows:- "If at any stage of scrutiny, inquiry, investigation or any other proceedings before him, any officer not below the rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of revenue, is of the opinion that the value has not been correctly declared or the credit availed is not within the normal limits, he may, with the prior approval of the Commissioner, direct such registered person by a communication in writing to get his records including books of account examined and audited by a chartered accountant or a cost accountant as may be nominated by the Commissioner." The juxtaposition of the words 'any other proceeding ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n'ble Supreme Court case involving Liberty Union Mills v. Union of India, by the appellant do not come to their aid. 5.5.2 The appellant has relied upon the Hon'ble Supreme Court case involving Radha Krishan Industries v. State of Himachal Pradesh and Ors. However, on perusal of the judgment, it is seen that the said case revolves around provisional attachment and specifically as to whether the same was in consonance with the conditions stipulated in Section 83 of the CGST/HPGST Act, 2017. We also come to understand that this case focusses mainly on rendering the provisional attachment under Section 83 in that case as 'ultra-vires' or illegal, and about the taxpayer's entitlement to submit objections and to have an opportunity of being heard before the provisional attachment. It becomes imperative to note here that the first proviso to Section 98 (2) of the CGST Act, 2017, discusses about "any proceedings in the case of the applicant under any of the provisions of this Act". On the other hand, Section 83 (1) of the Act, ibid, talks about a situation, viz., "Where during the pendency of any proceedings under Section 62 or Section 63 or Section 64 or Section 67 or Section 73 or Sect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... avour the case of the appellant, the decision of the Hon'ble High Court of Andhra Pradesh in the case of M/s. Master Minds favours the decision of the AAR. It is a well settled principle of interpretation that when there are different decisions in the orders of two Hon'ble High Courts, the binding force of precedence is diminished and the judicial / quasi-judicial authorities can take their view based on the most logical of the two different decisions of the Hon'ble High Courts. 5.6.2 We observe that the Hon'ble High Court of Telangana in para 12 of the judgment dated 17.08.2022 only mentions that in the context of the matter, inquiry or investigation would not come within the ambit of the word "proceedings". This is clear from the said para 12 of the judgment which is reproduced below :- "12. Though the word "proceedings" has neither been defined in Chapter XVII nor in the definition clause i.e., in Section 2 of the CGST Act, if the said word is understood in the context in which it is being applied, namely, any proceedings pending or decided in the case of an applicant under the provisions of the CGST Act, it would mean proceedings where the question raised in the application ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... all be sent to the applicant and to the concerned officer. (4) Where an application is admitted under sub-section (2), the Authority shall, after examining such further material as may be placed before it by the applicant or obtained by the Authority and after providing an opportunity of being heard to the applicant or his authorised representative as well as to the concerned officer or his authorised representative, pronounce its advance ruling on the question specified in the application. (5) Where the members of the Authority differ on any question on which the advance ruling is sought, they shall state the point or points on which they differ and make a reference to the Appellate Authority for hearing and decision on such question. (6) The Authority shall pronounce its advance ruling in writing within ninety days from the date of receipt of application. (7) A copy of the advance ruling pronounced by the Authority duly signed by the members and certified in such manner as may be prescribed shall be sent to the applicant, the concerned officer and the jurisdictional officer after such pronouncement." As can be seen, Section 98(2) of the CGST/APGST says that authority ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... us, the proceedings conducted by the investigating authority under the provisions of this Act shall be construed as judicial proceedings as per the CGST/APGST Act. -------------------------- 11. Thus, the above jurisprudence tells us that any proceedings referred to in 98 (2) proviso encompasses within it the investigation against the applicant as per the provisions of CGST/APGST Act and if by the date of filing of the application before the ARA, already such proceedings were commenced, the ARA shall not admit the application inviting advance ruling. Learned Senior counsel for respondent has not placed any contra citations before us to hold any other view. 12. Coming to the instant case, summons were issued to the petitioner on 01.07.2019 by Senior Intelligence Officer, DGGSTI and the panchanama was recorded on 01.07.2019. Copy of panchnama proceedings filed along with the writ petition contains a detailed examination of the petitioner by the Senior Intelligence Officer. The question numbers 9 to 16 relate to the courses conducted by the petitioner, the registration of the petitioner institution under GST Act and its payment of tax etc. particulars, which can be said to be co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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