High Court orders GST department to transfer documents to DGGI during investigation

The Hon’ble Gujarat High Court in VIPULCHANDRA PURSOTTAMDAS MAHANT PROP OF VAIBHAVI CONSTRUCTION VERSUS ASSISTANT COMMISSIONER OF STATE TAX - 2023 (7) TMI 99 - GUJARAT HIGH COURT  directed the assessee to co-operate with the inquiry initiated by the DGGI and further directed Assistant Commissioner of State Tax and State Tax Officer 2 to provide all relevant documents to the DGGI Officer for further investigation.

Facts:

An Inspection was conducted on the Premises of Vipulchandra Pursottamdas Mahant Prop of Vaibhavi Construction (“the Petitioner”) under Section 67(1) of the Central Goods and Services Tax Act, 2017(“the CGST Act”) on December 10, 2021 by the senior intelligence officer, DGGI (“the DGGI Officer”) who has asked to supply the necessary documents in connection with the inquiry.

Further, the Assistant Commissioner of State Tax(“the Assistant Commissioner”) and the State Tax Officer 2 (“the State Officer”) issued summons under Section 70 of the Act to the petitioner and petitioner is asked to supply the necessary documents in connection with the inquiry initiated and further vide communication dated May 10, 2023 sought the documents for further investigation.

The Petitioner contended that the documents are in possession of the DGGI Officer and  thus, the Assistant Commissioner and the Sate Officer have no authority to proceed further with the inquiry in connection with the same subject matter.

The Petitioner relied upon the Section 6(2)(b) of the CGST Act and submitted that the first investigation is initiated by the DGGI Officer in connection with the Petitioner and therefore, it is not open to Assistant Commissioner and the Sate Officer.

Issue:

What would happen if DGGI and other agencies initiated proceedings and sought information from assessee, which is available with one of the agency?

Held:

The Hon’ble Gujarat High Court in VIPULCHANDRA PURSOTTAMDAS MAHANT PROP OF VAIBHAVI CONSTRUCTION VERSUS ASSISTANT COMMISSIONER OF STATE TAX - 2023 (7) TMI 99 - GUJARAT HIGH COURT  held as under:

• Directed, the Petitioner to co-operate with the inquiry initiated by the DGGI Officer and produce all the relevant documents.
• Further directed, the Assistant Commissioner and the Sate Officer to transfer the documents to the for necessary investigation initiated by DGGI Officer.

Our Comment:

The Hon’ble Gujarat High Court by directing for consolidation of documents under a single investigating unit, the court emphasizes the necessity for a cohesive approach in legal proceedings. This judgment provides valuable guidance for situations where multiple agencies have initiated investigations into the same subject matter, promoting efficiency and clarity in such scenarios.

(Author can be reached at [email protected])