M/S Bhavani Industries vs. The State Of Telangana
Held
The High Court found that the charge for disallowance of ITC in both proceedings appeared to be for irregular availment of ITC due to GSTR-1 and GSTR-3B discrepancies. Consequently, the Court set aside the SGST Assessment Order dated 12.05.2025 and remanded the matter to the SGST authorities to pass a fresh order after giving the petitioner an opportunity to be heard and submit documents. The SGST authorities were directed to consider dropping the ITC disallowance charge if it overlaps with CGST proceedings, and adjudicate the underreporting charge separately.
Facts
The petitioner, M/s. Bhavani Industries, faced two separate GST adjudication proceedings: one by SGST authorities for FY 2020-21, confirming demand for ITC disallowance and underreporting of tax liability, and another by CGST authorities for FY 2017-18 to 2020-21, confirming demand for ITC availed against fake invoices. The petitioner contended that the SGST proceedings overlapped with the CGST proceedings, violating Section 6(2)(b) of the CGST Act.
Key Issues
Whether parallel adjudication proceedings by SGST authorities, overlapping in issues and periods with prior CGST proceedings, are permissible under Section 6(2)(b) of the CGST Act, particularly concerning irregular Input Tax Credit availment and underreporting of tax liability.
Sections Cited
Section 74, Section 14(9), Section 50, Section 16(2)(b), Section 16(2)(c), Section 50(3), Section 74(9), Section 20, Section 6(2)(b), Rule 88B
AI-generated summary — verify with the full judgment below
IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY, THE TWENTY FIRST DAY OF JULY TWO THOUSAND AND TWENTY SIX PRESENT THE HONOURABLE THE CHIEF JUSTICE SRI APARESH KUMAR SINGH AND THE HONOURABLE SRI JUSTICE G.M. MOHIUDDIN WRIT PETITION NO:15'l s6 0F 2026 [ 348e ] ...PETITIONER Between: Y1: Bl :y":' ,lndustries,.Repres€nted by its proprietor Basanthtat Sah, S/o Shri Irjay Lar sah, aged about 4g years, at Survey No. 63/44,64/LUU, Chinna Shivanoor, Chegunta, Chinna Shivinoor, Medak, Tjangana, 502255. AND l The state of rerangana, Represented by its principar Secretary, commerciar Taxes, Secretariat, Hyderabad 2' The commissioner of the comm_erciar raxes Department, Terangana state, c.T Complex, Nampally, Hyderabad-500 00.1 .
The State Tax Officer-1 , Hyderabad Rural Division, 6th Floor, Gaganvihar Building, Opp. Gandhi Bhavan, Nampally, Hyderabad_50000.1. 4. The Additionar/Joint commissioner of ientiar rax (Anti Evasion), Medchar GST Bhavan, 1 1 -4-64gtB, Lak-di_ka_poot, Hyderabad-50d004. ...RESPONDENTS Petition under Article 226 of the Constitution of lndia praying that in the circumstances stated in lhe affidavit fired therewith, the H
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