Crown Metal Scraps vs. The Deputy State Ta Officer - 2

Held

The Court quashed the impugned orders dated 27.08.2024 and the consequential order dated 20.02.2025. The Court noted that Form GST DRC 05, issued under Rule 142(3), typically signifies the conclusion of proceedings, whereas the order following a Show Cause Notice in DRC 01 is usually in Form GST DRC 07. The Court found that the impugned order was passed on 27.08.2024 without the petitioner participating in the adjudication proceedings initiated vide DRC 01 dated 20.12.2023. It also observed a potential overlap that needed examination. Consequently, the case was remitted back to the first respondent to pass fresh orders on merits and in accordance with law within 30 days. The petitioner was given the liberty to substantiate their case, and the respondents were mandated to justify the passing of orders for the same period. The issue of double jeopardy was implicitly addressed by remitting the matter for fresh consideration, and the failure to provide the petitioner an opportunity to participate was a key factor in quashing the order.

Facts

The petitioner, Crown Metal Scraps, filed a writ petition challenging an order dated 27.08.2024 passed by the Deputy State Tax Officer - 2, Karur, for the tax period 2019-20. The petitioner contended that a previous order for the identical period was passed on 04.10.2023 in GST DRC 05 under Section 74 of the TNGST Act, 2017, leading to double jeopardy. The impugned order was passed on 27.08.2024 without the petitioner participating in the adjudication proceedings initiated via DRC 01 dated 20.12.2023. The petitioner also challenged a consequential order dated 20.02.2025 made in Form GST DRC - 13 under Rule 145(1) read with Section 79(1)(c) of the TNGST Act, 2017, passed by the Assistant Commissioner (ST).

Key Issues

1. Whether the impugned order dated 27.08.2024, passed for the tax period 2019-20, is liable to be quashed on the grounds of double jeopardy, given that a prior order for the same period was passed on 04.10.2023. (Relates to principles of natural justice and res judicata). 2. Whether the adjudication proceedings initiated vide DRC 01 dated 20.12.2023 and the subsequent order dated 27.08.2024 were passed without the petitioner's participation, rendering them illegal. (Relates to principles of natural justice). Petitioner's contentions: The impugned order for the tax period 2019-20 results in double jeopardy as an earlier order for the same period was already passed on 04.10.2023. The adjudication proceedings were initiated via DRC 01 dated 20.12.2023, but the impugned order was passed on 27.08.2024 without the petitioner participating in these proceedings. Revenue's contentions: Not recorded in the judgment.