TaxTMI 
TaxTMI 
2026 (1) TMI 201
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....g reliefs:- "(i) Quashing the impugned Order-in-Original dated 20.01.2025 bearing File No.GEXCOM/ADJN/GST/JC/ 284/2022 and DIN No.2025015700000000E087, passed by Respondent No.1 under Section 74(1) read with Section 122(2)(b) of the Central Goods and Services Tax Act, 2017 for the tax period of July 2017 - March 2018 (Annexure-A); (ii) Quashing the impugned summary of the Order-in-Original in Form GST DRC 07 dated 23.01.2025 bearing Reference No.ZD2901250919119 issued by Respondent No.1 under Section 74(1) of the Central Goods and Services Tax Act, 2017 for the tax period of July 2017 - March 2018 (Annexure-'A1') (iii) Declaring that the impugned order and summary thereof were passed and issued by the 1st Respondent in gross violation of Section 6(2)(b) of the CGST Act 2017 and is thus without jurisdiction and the authority of law; and (iv) Pass such other or further orders as this Hon'ble Court may deem fit in the facts and circumstances of the case, in the interest of justice and equity." 2. Heard learned counsel for the petitioner, learned counsel for respondent Nos.1 to 4, 6 and 12 and learned HCGP for respondent Nos.5, 7, 8, 9, 10 and 11 ....
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.....01.2024. Since the petitioner failed to submit reply to the aforesaid intimations/letters/show-cause notices, respondent No.2 proceeded to pass the impugned adjudication order dated 08.02.2024 at Annexure-A and thereafter respondent No.1 passed an order-in-original dated 30.04.2024, aggrieved by which petitioner is before this Court by way of the present petition, inter alia contending that in the light of the provisions contained in Section 6(2)(b) of the CGST/KGST Act, 2017, dual/parallel proceedings in relation to the very same subject matter are barred and since the Central GST authorities had already initiated proceedings against the petitioner, the impugned proceedings initiated by the respondents-State GST Authorities are not maintainable and liable to be quashed. In support of its contentions, petitioner places reliance upon the following judgments of this Court. (i) M/s. Toyota Kirloskar Motor Pvt. Ltd Vs. Union of India and others - 2024 (10) TMI 1240 - Karnataka HC. (ii) M/s. Huida Sanitaryware India Pvt. Ltd. Vs. Deputy Commissioner of Central Tax - W.P.No.14068/2023 dated 19.09.2024. (iii) M/s. Toyota Logistics Kishor India Pvt. Ltd. Vs. Sta....
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....f M/s. Toyota Kirloskar Motor Pvt. Ltd Vs. Union of India and others - 2024 (10) TMI 1240 - Karnataka High Court, this Court held as under: "In this petition, the petitioner seeks the following reliefs: "a) Issue a writ of Certiorari or a Writ in the nature of Certiorari or any other appropriate Writ or order or direction under Article 226 of the Constitution of India quashing the impugned show cause notices bearing No. JCCT (VIG) / ACCT-3/GST/ADJN-14/23- 24/1185 dated 05.08.2023 and impugned show cause notices bearing Nos.JCCT (VIG) / ACCT-3/GST/ADJN15/23-24/1185 dated 05.08.2023 issued by the Respondent No.6 in FORM GST DRC-01 enclosed at Annexures - A and A-1 demanding input tax credit availed by the Petitioner along with interest and penalty; b) Issue a writ of Certiorari or a Writ in the nature of Certiorari or any other appropriate Writ or order or direction under Article 226 of the Constitution of India quashing the impugned Show Cause Notice No. DCCT(Audit)2.3/ 456/2023-24 dated 06.10.2023 issued by the Respondent No.7 along with the four FORM GST DRC-01's dated 06.10.2023 enclosed at Annexures-A2 demanding input tax credit availed by the Peti....
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....same subject matter by issuing letters / notices on 11.08.2022 and 20.09.2022 onwards and consequently, in the light of the provisions contained in Section 6(2)(b) of the Karnataka Goods and Services Tax Act 2017 [for short, 'the KGST Act, 2017], the impugned Show Cause Notices at Annexure - A, Al and A2 are illegal, arbitrary and without jurisdiction or authority of law since parallel / dual proceedings cannot be initiated by the State GST Authorities after the Central GST Authorities had already initiated proceedings prior to issuance of the impugned Show Cause Notices, which deserve to be quashed. 6. It is submitted by learned counsel for the petitioners that insofar as the impugned Show Cause Notice at Annexure - B dated 27.09.2023 issued by the Central GST Authorities is concerned, denial of input tax credit in favour of the petitioner in terms of Section 16(4) of the CGST Act, 2017 having been allegedly taken belatedly is contrary to the Circular No.211/5/24-GST dated 26.06.2024 as well as the judgment of this Court in the case of M/s. Bosch Limited Vs. the State of Karnataka and Deputy Commissioner of Commercial Taxes, 2024 VIL-828-KAR. It is also submitted that....
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....to avail ITC and cannot be deprived of the same or fastened with liability to pay interest on account of his claim having filed belatedly as can be seen from the circular. 11. The relevant portions of the decision of this court in the case of M/s. Bosch Ltd. V. State of Karnataka & Ors., is reproduced hereunder: "5. Before adverting to the rival contentions, it is relevant to extract the aforesaid circular issued by the CBIC, which reads as under: "2.5 It can be seen that section 16(4) of CGST Act links the time limit for ITC availment with the financial year to which the invoice or debit note pertains. As discussed in Para 2.3 above, in case of supplies where the supplier is unregistered and recipient is registered and the tax has to be paid by the recipient on RCM basis, the recipient is required to issue invoice in terms of the provisions of section 31 (3) (f) of CGST Act and pay the tax on the same in cash under RCM. Further, as discussed in Para 2.1 above, ITC cannot be availed by a registered person in respect of any supply of goods or services or both received by him, as per the provisions of section 16 (2) (a) of CGST Act, unless he is in possessi....
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....inding upon the respondents. However, since the said circular was issued during the pendency of the present petition and the respondents did not have the benefit of the said circular at the time of issuance of the Show Cause Notice, I deem it just and appropriate to dispose of this petition and direct respondent No.2 to consider the objections to be filed by the petitioner and proceed further in accordance with law, bearing in mind the aforesaid circular and take appropriate decisions/pass appropriate orders in accordance with law." 12. The challenge to the impugned Show Cause Notice at Annexure-B can be disposed of by directing the petitioner to submit a suitable reply together with the relevant documents and by directing the concerned respondent Nos.1, 3 and 4, Central - GST Authorities to consider the same and proceed further in accordance with law bearing in mind the observations made in this order and the provisions referred to supra (Section 13(3)(C) of the CGST Act, 2017, Section 128A of the CGST Act, 2017, Circular No. 211/5/24-GST dated 26.06.2024 etc.) . 13. In the result, the following: ORDER (i) The petition is allowed - in - part. ....
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....the CGST authorities after initiation of the proceedings by the Karnataka State GST Authorities in the very same subject matter, is barred under Section 6 (2) (b) of the CGST Act, penalty proceedings under Section 122 of the CGST Act are also barred by virtue of Section 74 of the CGST Act. It is therefore submitted that the impugned show cause notice and further proceedings pursuant thereto deserves to be quashed. 5. Per contra, learned counsel for the respondent supports the impugned order and submits that proceedings initiated by the CGST Authorities and State Government GST Authorities are different and the question of quashing Show Cause Notice does not arise and submits that there is no merit in the petition and the same is liable to be dismissed. 6. A perusal of the material on record in particular Annexure-C dated 15.09.2022 issued by CGST authorities and adjudication order dated 09.11.2022 at Annexure-D is sufficient to come to the conclusion that the both relates to the same subject matter in relation to the transaction between petitioner and M/s Crystal Hardware. 7. In this context, it is relevant to extract Section 6 of the CGST which reads as ....
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....eemed to be concluded. Explanation 1.-For the purposes of section 73 and this section,- (i) the expression ―all proceedings in respect of the said notice shall not include proceedings under section 132; (ii) where the notice under the same proceedings is issued to the main person liable to pay tax and some other persons, and such proceedings against the main person have been concluded under section 73 or section 74, the proceedings against all the persons liable to pay penalty under sections 122, 125, 129 and 130 are deemed to be concluded. Explanation 2.--For the purposes of this Act, the expression ―suppression shall mean non-declaration of facts or information which a taxable person is required to declare in the return, statement, report or any other document furnished under this Act or the rules made thereunder, or failure to furnish any information on being asked for, in writing, by the proper officer." 10. The aforesaid explanation No.1 clearly indicates that once proceedings are initiated under Sections 73 or 74, penalty proceedings under Section 122 are deemed to have been concluded and on this ground also, the impugn....
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....rring to the material on record, learned counsel for the petitioner submits that the demand made by the respondents in the impugned Show Cause Notice was illegal, arbitrary and without jurisdiction or authority of law and opposed to the statutory provisions. 6. The learned counsel for the petitioner submits that the impugned Show Cause Notice proposes to raise two demands: (i) Demand of Rs.1,68,04,057/- being IGST payable on the taxable manpower supply services received by the Petitioner during the period July 2017 to November 2022, along with interest; and (ii) Demand of Rs.1,30,28,404/- being input tax credit availed on manpower supply services received during the period April 2019 to November 2022. 7. In regard to the first demand, the learned counsel for the petitioner submits that the impugned Show Cause Notice deserves to be quashed on the ground that proceedings were initiated by the State GST Authorities vide Show Cause Notice dated 12.05.2023 which culminated in an adjudication Order-In-Original dated 07.08.2023 which was thereafter set aside by the Appellate Authority vide Order dated 05.03.2024. The learned counsel for the petitioner s....
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.... 29.07.2024 and the Circular No. 211/5/2024-GST dated 26.06.2024 issued by the Central Board of Indirect Taxes and Customs, New Delhi. In my view, the input tax credit has been validly availed in terms of the decisions and Circular referred to supra. 13. In view of the aforesaid facts and circumstances, I deem it just and appropriate to dispose of this petition by issuing certain directions. 14. In the result, I pass the following: ORDER (i) Petition is hereby disposed of. (ii) The impugned Show Cause Notice at Annexure - A dated 28.09.2023 issued by the Respondent No. 3 to the extent of demand of IGST of Rs.1,68,04,057/- along with interest in terms of Section 6(2)(b) of the CGST Act, 2017 is hereby quashed; (iii) The petitioner is reserved with liberty to submit a reply along with documents to the impugned Show Cause Notice at Annexure - A dated 28.09.2023 to the extent of demand of input tax credit of Rs.1,30,28,404/- along with interest, within a period of three weeks from the date of receipt of a copy of this order. (iv) The concerned respondents shall consider the said reply and documents to be submitted by the petition....