Background: The crux of the matter revolves around an authority under the SGST Act issuing a Demand–cum–Show Cause Notice on 23.11.2022, and subsequently, an authority under the CGST Act issuing a similar notice on 27.04.2023. Both notices alleged that during the Financial Years 2017-2018, 2018-2019, and 2019-2020, the petitioner-assessee availed and utilized Input Tax Credit [ITC] amounts that were deemed inadmissible under Section 16[4] of the CGST Act/SGST Act. The CGST Act authority passed an Order-in-Original on 14.11.2023, followed by the SGST Act authority passing an Order-in-Original on 11.12.2023.
Contention: The writ petition contends that initiating two parallel proceedings for the same period (2017-2018) is impermissible under Section 6 of the CGST Act, 2017, and SGST Act, 2017.
Legal Steps: The court, acknowledging the gravity of the contention, issued notices returnable on 18.03.2024. As Mr. Choudhury and Mr. Keyal accepted the notices on behalf of their respective respondents, no formal notices were deemed necessary. The petitioner's counsel is required to serve extra copies of the petition and annexures to Mr. Choudhury and Mr. Keyal within two working days.
Legal Analysis: Section 6 of the CGST/SGST Act, particularly Section 6[2], stipulates that once a proceeding is initiated under either of the Acts, a parallel proceeding for the same period under the other Act is not permissible. Consequently, the court has ordered the suspension of the operation of the Order-in-Original dated 11.12.2023 [Annexure-F] passed by the respondent no. 3 until the returnable date.
This legal intervention aims to address the potential conflict arising from dual proceedings and ensures a fair and just examination of the petitioner's case.
Title: Subhash Agarwalla versus State of Assam (Gauhati High Court)
Citation: 2024 TAXONATION 399 (GAUHATI)
Comment: