Parallel GST proceedings on same tax issue barred under s. 6(2)(b); later SGST show-cause notice quashed, writ allowed.

Once proceedings on a subject matter have been initiated by CGST authorities, SGST authorities lack jurisdiction to commence parallel proceedings on the same subject matter because such dual action is barred by s. 6(2)(b) of the CGST Act. Applying this statutory bar and consistent with prior HC precedent on similar facts, the HC held that the subsequent SGST show-cause and adjudication proceedings were not maintainable. Consequently, the impugned SGST show-cause notice and the impugned orders (including the order-in-original, adjudication order, and summary orders) were quashed and the writ petition was allowed.

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1. ISSUES PRESENTED AND CONSIDERED

(i) Whether, in view of Section 6(2)(b) of the CGST/KGST Act, 2017, the State GST authorities lacked jurisdiction to initiate and conclude proceedings on the same subject matter after proceedings had already been initiated by the Central GST authorities.

(ii) Whether the impugned State GST adjudication orders and their corresponding summary orders were liable to be quashed as being dual/parallel proceedings barred by Section 6(2)(b).

2. ISSUE-WISE DETAILED ANALYSIS

Issue (i) & (ii): Bar on dual/parallel proceedings under Section 6(2)(b) and validity of State GST adjudication orders

Legal framework (as discussed by the Court): The Court examined Section 6 of the CGST/KGST Act, 2017 and, in particular, Section 6(2)(b), which stipulates that where proceedings on a subject matter have been initiated by a proper officer under one enactment, no proceedings shall be initiated by the proper officer under the other enactment on the same subject matter.

Interpretation and reasoning: On a plain reading of Section 6(2)(b), the Court held that once proceedings are initiated by the Central GST authorities, the State GST authorities have no jurisdiction or authority of law to initiate parallel/dual proceedings in relation to the very same subject matter. The Court found, on the material placed, that proceedings had already been initiated by the Central GST authorities and that the subsequent actions of the State GST authorities constituted barred parallel proceedings. The Court applied the principles laid down in earlier decisions of the same Court (referred to in the judgment) to the facts before it.

Conclusions: The Court conclusively held that the State GST proceedings were not maintainable and were barred under Section 6(2)(b). Consequently, the Court quashed the State GST authorities' order-in-original and the related summary order, as well as the State adjudication order and its related summary order.

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