V.Karthick vs. The Superintendent / Senior Intelligent Officer

Held

The Court held that the petitioner's challenge to the summons was bad in law because he had already appeared and provided a reply to the summons before filing the writ petition. The Court found no illegality in the issuance of the summons, stating that if the respondent was not satisfied with the explanation, they could proceed according to law. Regarding the issuance of summons to the petitioner's customers, the Court held that it is a statutory element under Section 70 of the CGST Act, 2017, to unearth tax evasion and arrive at a logical conclusion. The summons to customers were issued based on intelligence and directions from competent authorities. Therefore, the Court found no error in issuing the impugned summons and was not inclined to quash them. The Court dismissed the writ petition.

Facts

The petitioner, V. Karthick, filed a writ petition challenging two summons dated 14.08.2025 and 02.09.2025 issued by the Superintendent/Senior Intelligent Officer, CGST, Madurai. The petitioner alleged that the summons were issued in retaliation for a complaint he lodged on 02.12.2024, which led to the arrest of three individuals. He further contended that the respondent was issuing summons to his customers to disrupt his business, even after the investigation concluded in 2024. The petitioner had previously appeared in response to an earlier summons with his auditor and provided documents for the period up to November of a certain year. The respondent argued that the investigation was initiated based on intelligence and was not concluded in 2024. They also stated that the petitioner appeared on 29.08.2025 in response to the first summons and admitted that further documents would be submitted, leading to the second summons.

Key Issues

1. Whether the issuance of summons dated 14.08.2025 and 02.09.2025 by the respondent is illegal and arbitrary, particularly in light of the petitioner having already responded to a previous summons and provided documents for a significant period, and whether the investigation was concluded in 2024 as argued by the petitioner. This issue turns on the interpretation and application of Section 70 of the Central Goods and Services Tax (CGST) Act, 2017, and potentially Section 67 of the same Act, concerning the initiation and continuation of investigations. 2. Whether the issuance of summons to the petitioner's customers is a statutory element permissible under Section 70 of the CGST Act, 2017, for the purpose of unearthing tax evasion, as contended by the respondent. Petitioner's arguments: The respondent failed to initiate investigation under Section 67 of the CGST Act before issuing summons under Section 70. Continuous issuance of summons to customers is unreasonable and arbitrary, especially after the investigation concluded in 2024. The summons are issued out of vengeance. Respondent's arguments: Investigation was initiated based on intelligence and was not concluded in 2024. Issuance of summons is a judicial proceeding under Section 70(2) read with Sections 228 and 229 of BNSS, 2023. The petitioner appeared, admitted to submitting more documents, and then challenged the summons, making the prayer infructuous. The summons were issued following due procedure to provide another opportunity.