M/S Sri Vinayaka Electricals vs. Commercial Tax Officer

Held

The Court held that under Section 6(2)(b) of the CGST Act, once State authorities initiate proceedings on a subject matter, Central authorities cannot initiate parallel proceedings. It quashed the Central GST proceedings and orders. For the State GST proceedings, the Court found a denial of natural justice (personal hearing) and quashed the adjudication orders and garnishee notices, remanding the matter for fresh consideration from the show cause notice stage, subject to a 10% tax deposit.

Facts

The petitioner challenged multiple show cause notices, adjudication orders, and garnishee notices issued by both State (KGST) and Central (CGST) authorities for the same subject matter. The petitioner contended that parallel proceedings were impermissible and that they were denied a personal hearing to explain discrepancies and claim exemptions under Notification No. 12/2017.

Key Issues

Whether parallel proceedings by State and Central GST authorities on the same subject matter are permissible under the GST law, and whether the petitioner was denied a reasonable opportunity of hearing before adjudication orders were passed.