2018 (12) TMI 1354 - HC - GST

Court affirms Mumbai jurisdiction in Central Excise & GST Act case, clarifies petitioner obligations.

The court dismissed the petition challenging an enquiry initiated by respondent No. 2 under the Central Excise Act and GST Act. It held that the ... Registration-based jurisdiction under Section 25 of the CGST Act, 2017 - Jurisdiction of registering authority - Concurrent or parallel enquiries - Summons under Section 14 of the Central Excise Act and Section 70 of the CGST Act, 2017 - Acceptance of xerox copies in lieu of originals produced before another authorityRegistration-based jurisdiction under Section 25 of the CGST Act, 2017 - Concurrent or parallel enquiries - Jurisdiction of registering authority - Whether the Superintendent of CGST & Central Excise, Mumbai, could lawfully issue summons and continue an enquiry despite an earlier summons issued by CGST authorities at Jaipur - HELD THAT: - The Court found that registration under the CGST Act and the Finance Act, 1994, taken in Mumbai subjects the petitioner to the jurisdiction of Mumbai authorities for activities carried out within their territorial sphere. The fact that an earlier summons had been issued by Jaipur authorities did not oust the jurisdiction of Mumbai where the assessee had separate registration and some services were rendered within Mumbai. Section 25 contemplates separate registration for each state and hence registration in Mumbai permits enquiry by Mumbai authorities into transactions within their jurisdiction. The petitioner's prior response to the impugned summons and the statement made before authorities did not render the petition maintainable for quashing the Mumbai enquiry. Therefore, no interference with the Mumbai investigation was warranted. [Paras 4, 5]The Mumbai enquiry by respondent No. 2 stands; the petition is dismissed.Acceptance of xerox copies in lieu of originals produced before another authority - Whether xerox copies of documents would be accepted by Mumbai authorities where the originals have already been produced to Jaipur authorities - HELD THAT: - The Court directed that where the originals of documents sought by Mumbai authorities have already been given to the Jaipur authorities, production of xerox copies in Mumbai (accompanied by evidence of original production at Jaipur) will be accepted as sufficient compliance. This direction was given as a limited practical measure to avoid multiplicity of original document production while preserving the investigatory reach of the Mumbai authority. [Paras 5]Xerox copies will be accepted by Mumbai authorities as sufficient compliance if originals were produced to Jaipur and proof of such production is shown.Final Conclusion: Petition under Article 226 dismissed: Mumbai authorities lawfully maintain jurisdiction to enquire against the petitioner in respect of activities within their territory notwithstanding an earlier Jaipur summons; xerox copies may be accepted by Mumbai where originals have been produced to Jaipur on proof. Issues:Challenge to enquiry initiated by respondent No. 2 under Central Excise Act and GST Act, Jurisdiction of Mumbai authorities over petitioner's business, Parallel proceedings by different authoritiesAnalysis:The petitioner filed a petition challenging an enquiry initiated by respondent No. 2, the Superintendent of CGST & Central Excise in Mumbai, through summons dated 28.9.2018 under Section 14 of the Central Excise Act, 1944, and Section 70 of the Central Goods & Services Tax Act, 2017. The petitioner argued that he was already under investigation by CGST Authorities in Jaipur, who had issued a summons dated 7.9.2017. The petitioner contended that conducting two parallel proceedings on the same subject was without jurisdiction.Respondent Nos. 2 and 3 argued that the petitioner had responded to the summons dated 28.9.2018 and had made a statement before the authorities on 18.1.2018. The respondents contended that the petition should not be entertained due to the petitioner's actions. The court acknowledged that the petitioner had registered under the CGST Act 2017 and the Finance Act, 1994 (service tax) in Mumbai, making him subject to the jurisdiction of Mumbai authorities for business conducted within their jurisdiction. The petitioner claimed that his primary business operations were in Jaipur, but the court held that registration in Mumbai and providing services there subjected the petitioner to Mumbai authorities' jurisdiction, as per Section 25 of the CGST Act 2017, which mandates separate registration for each state. Therefore, the court found no grounds to interfere with the investigation by respondent No. 2 in Mumbai and dismissed the petition.The court concluded by dismissing the petition but clarified that if the originals of documents sought by respondent No. 2 in Mumbai had already been provided to the authorities in Jaipur, then the production of photocopies would be accepted as sufficient compliance by the Mumbai authorities. This judgment clarifies the jurisdictional issues concerning parallel proceedings by different authorities and the obligations of the petitioner under the Central Excise Act and the GST Act.