M/S. Aarush Enterprises vs. The Assistant Commissioner Of Central Tax
Held
The High Court directed that the Central Tax SCN be kept in abeyance until the appeal against the State Tax penalty order is concluded. The State Appellate Authority was instructed to conclude the appeal within three weeks. The Central Tax authorities can then proceed with their SCN, considering the petitioner's reply, arguments on overlap, and the findings of the State Appellate Authority.
Facts
M/s. Aarush Enterprises challenged a Show Cause Notice (SCN) issued by Central Tax authorities under Sections 73 and 74 of the CGST/TGST Act, alleging excess ITC availment, ITC from cancelled registrations, and ineligible credit. The petitioner contended that this SCN overlapped with proceedings already adjudicated by State Tax authorities under Section 122 of the TGST Act, which resulted in a penalty order against which an appeal was pending, violating Section 6(2)(b) of the Act.
Key Issues
The key legal issue was whether the Central Tax authorities could issue a Show Cause Notice when State Tax authorities had already initiated and concluded proceedings (with an appeal pending) on allegedly overlapping issues, particularly concerning fake invoices and ITC availment, in light of Section 6(2)(b) of the CGST/TGST Act.
Sections Cited
Section 73, Section 74, Section 6(2)(b), Section 17(5), Section 122, Section 121(1)
AI-generated summary — verify with the full judgment below
[ 3488 ] IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD (Special Original Jurisdiction) TUESDAY,THE SIXTH DAY OF JANUARY TWO THOUSAND AND TWENTY SIX PRESENT THE HONOURABLE THE CHIEF JUSTICE APARESH KUMAR SINGH AND THE HONOURABLE SRI JUSTICE G.M. MOHIUDDIN WRIT PETITION NO: 32866 OF 2025 Between: AND M/s. Aarush Enterprises, 3-6-293, Opposite Apollo Hospital, Hyderguda, Hyderabad, Telaniana- 500029. Represented !Y its Proprie_tof,_ 9!ql:,lt Kistappa Naik, S/o--Kishtappa Naik, Aged about 40 years, Rlo 10-3-7412311. Teachbrs Colony, East Mairbdpally, Secunderabad, Telangana- 500 026 ...PETITIONER
The Assistant Commissioner of Central Tax, Himayatnagar Division, Hyderabad Commissionerate, H. No. 3-6-436/1 to 438/1 , 1'' Floor, Naspur House, Hyderabad -500 029
The Sup6rintendent of Central Tax, Himayathnagar-.!l- Range, Himay,atnagar Division, Hyderabad Commissionerate, H. No. 3-6-43611 to 438/1, 1" Floor, Naspur House, Hyderabad -500 029
The Deputy Corirmissioner ST, Enforcement Wing, O/o Commercial Tax Department. Nampally, Hyderabad, Telangana
Union of lndia, trlinistry of Finance, Repreiented by its Secretary, North Block, New Delhi-110 001
State of Telanga
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