V.M. & Co. Vs State Tax Officer (Madras High Court)
Madras HC Quashes Parallel GST Proceedings Due to Possible Overlap With Central Investigation; GST Parallel Proceedings Invalid if Based on Same Subject Matter Already Examined; Madras HC Applies Supreme Court Armour Security Ruling to Set Aside GST Assessment; State GST Assessment Quashed as Court Orders Verification of Overlap With Central GST Order; Section 6(2)(b) Bars Duplicate GST Proceedings on Same Contravention; Madras HC Says ‘Same Subject Matter’ Under GST Means Identical Tax Liability and Facts; GST Authorities Directed to Exclude Transactions Already Covered by Central Order
The Madras High Court quashed assessment orders passed by the State GST authorities under Section 74 of the TNGST Act for the financial year 2018-19 and remanded the matter for reconsideration. The petitioner contended that the Directorate General of GST Intelligence, Coimbatore Zonal Unit, had already examined the same issue relating to turnover differences between income tax returns and GSTR-3B, culminating in an order dated 08.12.2022, pursuant to which the petitioner had discharged the liability. Therefore, according to the petitioner, fresh proceedings by the State authorities on the same subject matter were barred under Section 6(2)(b) of the CGST Act.
The State authorities argued that the earlier proceedings by the Central authorities were confined to discrepancies based on GSTR-3B, whereas the impugned proceedings involved suppression detected through GSTR-9 annual returns. The Court referred to the Supreme Court judgment in Armour Security (India) Ltd. v. Commissioner, CGST, which clarified that Section 6(2)(b) bars parallel proceedings on the “same subject matter,” meaning identical tax liability or contravention arising from the same facts.
