CGST audit notice and parallel State GST proceedings turn on whether the same subject matter is involved.

Section 6(2)(b) of the CGST Act bars Central GST proceedings only when they concern the same subject matter as prior State GST proceedings. An audit notice under section 65 was considered in that context because the notice recorded that proceedings were not restricted on any other subject matter and proposed audit action under the CGST Act. The matter was not finally adjudicated on merits, and the taxpayer was left to respond to the audit notice.

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Issues: Whether an audit notice under section 65 of the Central Goods and Services Tax Act, 2017 was barred by section 6(2)(b) of the same Act on the ground that State GST proceedings on the same subject matter had already been concluded.

Analysis: The prohibition in section 6(2)(b) applies only where the subsequent proceedings by the Central GST authorities concern the same subject matter as the proceedings initiated by the State GST authorities. The impugned notice itself recorded that there was no restriction to initiate proceedings on any other subject matter and proposed audit under section 65 of the Central Goods and Services Tax Act, 2017. On that basis, the dispute was not finally adjudicated on merits, and the petitioner was left to respond to the audit notice.

Outcome: The writ petition was disposed of with liberty to the petitioner to respond to the audit notice, and the connected miscellaneous petitions were closed.

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