GST Assessment Order Quashed Due to Jurisdictional Error, State Authorities Permitted to Reassess Tax Liability

HC allowed the writ petition challenging GST assessment order. The court quashed the order passed by Central Tax Authorities, finding jurisdictional defect since the petitioner was under State Tax Authority's assessment. The court permitted State authorities to proceed with assessment in accordance with previous observations, without awarding costs.

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Issues:
The petitioner challenged Order-in-Original No.24/2023-GST passed by the respondent for assessment years 2017-2018, 2018-2019, and 2019-2020. The petitioner claimed that the order was passed despite a stay granted by the Principal Seat of the Court against the operation of a notification extending the period of limitation. Additionally, the petitioner argued that being assessed by State Tax Authorities, the order by Central Tax Authorities was contrary to established law.

Stay Order Issue:
The petitioner contended that the impugned order was passed despite a stay granted by the Court against the operation of the notification extending the period of limitation. This stay was issued in a previous case, and the petitioner argued that the respondent should not have proceeded with the assessment during the pendency of the stay order.

Jurisdiction Issue:
The petitioner argued that being assessed by State Tax Authorities, the order by Central Tax Authorities was against the law. Reference was made to a previous case where the Court had discussed the issue of cross-empowerment and jurisdiction of authorities when an assessee is allocated to either Central Tax Authorities or State Tax Authorities.

Cross-Empowerment and Jurisdiction:
The Court examined the issue of cross-empowerment and jurisdiction of authorities in cases where an assessee is allocated to different tax authorities. Referring to previous decisions and the provisions of the CGST Act, the Court concluded that in the absence of notification for cross-empowerment, authorities from the counterpart Department cannot initiate proceedings. The impugned order was quashed, allowing the State authorities to proceed against the petitioner as per previous observations.

Conclusion:
The Court allowed the Writ Petition, quashed the impugned order, and granted liberty to State authorities to proceed against the petitioner. No costs were awarded, and connected Miscellaneous Petitions were closed.

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