Kuppan Gounder P.G. Natarajan vs Directorate General of Gst Intelligence,New Delhi  

In this case, the writ petition challenges a summons issued by the Senior Intelligence Officer under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017. The primary contention raised by the petitioner’s Senior Counsel revolves around the applicability of Section 6(2)(b) of the CGST Act.

According to Section 6(2)(b) of the Act, if a proper officer under the State Goods and Services Tax Act (SGST) or the Union Territory Goods and Services Tax Act (UTGST) has already initiated proceedings on a particular subject matter, then no proceedings on the same subject matter should be initiated by a proper officer under the CGST Act. The petitioner argues that this clause prohibits the Central authorities from initiating proceedings while the State authorities are already addressing the issue.

In support of this argument, the petitioner’s counsel points out that a notice highlighting discrepancies in the petitioner’s tax return was issued by the State authorities on December 17, 2020. This indicates that the State authorities have already begun scrutinizing the matter, and as per the CGST Act’s provisions, the Central authorities should refrain from initiating any parallel proceedings until the State’s inquiry is concluded.

The petitioner’s legal team is therefore requesting the court to recognize the ongoing State proceedings and to restrict the Central authorities from pursuing any actions on the same subject matter, as mandated by the law. This challenge essentially seeks to enforce the legal boundaries between the jurisdictions of State and Central tax authorities to prevent overlapping investigations.

The writ petition in question challenges the summons issued by a Senior Intelligence Officer under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017. The primary argument presented by the petitioner’s Senior Counsel revolves around Section 6(2)(b) of the CGST Act, which states that if a proper officer under the State Goods and Services Tax (SGST) Act or the Union Territory Goods and Services Tax (UTGST) Act has initiated any proceedings on a subject matter, no proceedings on the same subject matter should be initiated by a proper officer under the CGST Act.

The counsel argues that since the State authorities had already initiated proceedings against the petitioner on 17th December 2020, the Central authorities should refrain from initiating further proceedings until the State’s proceedings conclude. This argument forms the basis of the challenge against the summons issued by the Central authorities.

Despite the counsel’s argument on the merits, the court determined that it was not necessary to delve into the disputed facts or the merits of the case at this juncture. The court focused on the nature of the summons issued, which was for an inquiry into the petitioner’s company, M/s. KPN Travels India Limited & Others, under the CGST Act, 2017. The summons requested the petitioner to provide evidence or produce specific documents.

The court concluded that it would not be appropriate to restrain the authorities from conducting their investigation or proceedings under the statute. Entertaining the writ petition at this early stage could hinder the investigation and disrupt the legal process, which the court deemed undesirable. Consequently, the court did not see a need to intervene at this point, allowing the investigation to proceed.

In this case, a writ petition was filed challenging the summons issued by a Senior Intelligence Officer under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017. The petitioner argued that, according to Section 6(2)(b) of the Act, if proceedings have already been initiated by a State Goods and Services Tax (SGST) officer, no further proceedings on the same subject matter can be initiated by a Central Goods and Services Tax (CGST) officer. The petitioner’s counsel pointed out that since the State authorities had already issued a notice to the petitioner regarding discrepancies in their tax return, and the proceedings were ongoing, the Central authorities should have waited for the conclusion of those State-initiated proceedings before issuing any summons. Therefore, the petitioner contended that the summons issued by the Central authorities was without jurisdiction.

However, the court determined that it was unnecessary to delve into the factual disputes or the merits of the case at this point. The court emphasized that the summons in question was part of an investigation related to the petitioner’s company, M/s KPN Travels India Limited, under the CGST Act. The court noted that the summons merely requested documents and evidence from the petitioner, which is a standard procedure under the law. The court expressed the opinion that halting the investigation at this early stage could hinder the proper enforcement of the statute, thereby defeating its purpose.

The respondent’s counsel argued that the petitioner had already filed multiple writ petitions in an attempt to obstruct the investigation process, and was not cooperating with the ongoing investigation related to Integrated Goods and Services Tax (IGST). The respondent further contended that the State’s scrutiny of the petitioner’s tax returns and the Central authority’s investigation into IGST were distinct matters. Therefore, there was no legal basis to halt the proceedings initiated by the Central authorities.

Ultimately, the court decided that there was no need for it to intervene at this stage, as the challenge was directed at the jurisdiction of the summons itself, rather than at any substantive adjudication on the facts. The court left the matter to the competent authorities within the department to conduct the investigation based on the documents and evidence presented.

The writ petition in question challenges the summons issued by the Senior Intelligence Officer under Section 70 of the Central Goods and Services Tax (CGST) Act, 2017. The central issue raised by the petitioner is the application of Section 6(2)(b) of the Act, which prohibits the initiation of proceedings under the CGST Act if similar proceedings have already been initiated under the State Goods and Services Tax (SGST) Act or the Union Territory Goods and Services Tax (UTGST) Act on the same subject matter.

The petitioner’s Senior Counsel argued that the State authorities had already initiated proceedings against the petitioner by issuing a notice regarding discrepancies in tax returns on December 17, 2020. According to the counsel, the Central authorities should have waited for the conclusion of these State-level proceedings before issuing any summons, thus rendering the summons issued by the respondent as being without jurisdiction.

While the petitioner’s counsel discussed the merits of the case, the Court determined that the primary issue was whether the summons itself was lawful under the Act. The summons required the petitioner to submit documents and evidence related to an inquiry under the CGST Act. The Court concluded that it was not appropriate to halt the investigation prematurely, as this could obstruct the proper conduct of the proceedings. The Court emphasized that the examination of the merits of the case should be left to the competent authorities within the tax department, based on the documents and evidence presented.

The respondent’s counsel disputed the petitioner’s claims, noting that the petitioner had filed multiple writ petitions to delay the investigation and had not cooperated with the investigation process concerning the Integrated Goods and Services Tax (IGST). The respondent argued that the scrutiny of returns by the State authorities and the issuance of summons by the Central authorities were unrelated matters, and the investigation under the CGST Act should not be stalled.

The Court also observed that the petitioner had a history of filing multiple writ petitions to challenge various summonses and orders, which appeared to be an attempt to delay the proceedings rather than resolve the issues by submitting the required evidence. The Court expressed disapproval of this conduct, indicating that it was counterproductive to the judicial process and the ongoing investigation.

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