Transitional saving under GST repeal preserves audit proceedings under Section 174(2) despite expiry of earlier protection.

Section 19 of the Constitution (One Hundred and First Amendment) Act, 2016 is a transitional saving provision for inconsistent State laws, but it does not control the operation of the saving clause in Section 174(2) of the CGST Act, 2017. Section 174(2) expressly preserves investigations, enquiries, verifications, scrutiny, audit, assessment, adjudication, recovery and other proceedings relating to repealed or amended enactments, and allows them to be instituted, continued or enforced as if the repeal or amendment had not occurred. On that basis, the audit notice under the GST regime was not lacking in jurisdiction.

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Issues: Whether the audit notice issued under the Central Goods and Services Tax regime was jurisdiction on the ground that the transitional protection under the Constitution (One Hundred and First Amendment) Act, 2016 had expired.

Analysis: Section 19 of the Constitution (One Hundred and First Amendment) Act, 2016 is a transitional provision saving inconsistent State laws for a limited period, but it does not govern the operation of the saving clause contained in Section 174(2) of the Central Goods and Services Tax Act, 2017. Section 174(2) expressly preserves investigations, enquiries, verifications, scrutiny, audit, assessment, adjudication, recovery and other proceedings in respect of matters arising under the repealed or amended enactments, and permits such proceedings to be instituted, continued or enforced as if the repeal or amendment had not occurred.

Conclusion: The audit notice was not without jurisdiction and the writ petition failed.

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