M/S Adarsh Global Trades And Services PVT. LTD vs. Union Of INDIA

Held

The Court noted that the petitioner's grievance was that the State Authority could not initiate fresh proceedings for the same cause of action when simultaneous proceedings were initiated by the central authority, citing Section 6(2)(b) of the CGST Act, 2017. The learned Standing Counsel for the respondent-State Department produced correspondence dated 26.09.2023, informing the Court that the State authorities had decided to refrain from proceeding further with the show cause notice, as the matter had already been investigated and proceeded with by the 3rd respondent (Director General of GST Intelligence). In view of this decision by the respondent State, the Court found that the petitioner's grievance stood redressed and the cause in the writ petition no longer survived for adjudication. The Court expected that any material and documents collected by the respondent-State in the course of issuing the impugned show cause notice would be transferred to the 3rd respondent for necessary action. The Writ Petition was accordingly dismissed as infructuous.

Facts

The petitioner, M/s Adarsh Global Trades and Services Pvt. Ltd., filed a writ petition challenging a show cause notice (SCN) dated 30.05.2022 and an order dated 18.07.2023, both issued by the Deputy Commissioner (State Tax), Respondent No. 6. The petitioner contended that the State Authority (Respondent No. 6) could not initiate fresh proceedings for the same cause of action when the Director General of GST Intelligence (Respondent No. 3) had already initiated simultaneous proceedings. The amount in dispute was Rs. 17,16,97,944/-. The writ petition was filed under Article 226 of the Constitution of India.

Key Issues

1. Whether the State Authority (Respondent No. 6) had the jurisdiction to initiate fresh proceedings for the same cause of action when simultaneous proceedings were already initiated by the central authority (Respondent No. 3), in light of Section 6(2)(b) of the CGST Act, 2017? The petitioner argued that the action of Respondent No. 6 in passing an order for payment of Rs. 17,16,97,944/- was violative of Article 14 and 19 of the Constitution of India, Section 6(2)(b) of the GST Act, 2017, and the principles of natural justice, asserting that Respondent No. 6 lacked jurisdiction. The petitioner relied on Section 6(2)(b) of the GST Act, 2017. The respondents' contentions were not explicitly recorded in the provided text, other than the State Authority's subsequent decision to refrain from proceeding further.