Case Law Details
Vipulchandra Pursottamdas Mahant Prop of Vaibhavi Construction Vs Assistant Commissioner of State Tax (Gujarat High Court)
High Court orders GST department to transfer documents to DGGI during investigation
The Hon’ble Gujarat High Court in Vipulchandra Pursottamdas Mahant Prop of Vaibhavi Construction v. Assistant Commissioner of State Tax [R/Special Civil Application No. 9488 of 2023 dated June 22, 2023] directed the assessee to co-operate with the inquiry initiated by the DGGI and further directed Assistant Commissioner of State Tax and State Tax Officer 2 to provide all relevant documents to the DGGI Officer for further investigation.
Facts:
An Inspection was conducted on the Premises of Vipulchandra Pursottamdas Mahant Prop of Vaibhavi Construction (“the Petitioner”) under Section 67(1) of the Central Goods and Services Tax Act, 2017 (“the CGST Act”) on December 10, 2021 by the senior intelligence officer, DGGI (“the DGGI Officer”) who has asked to supply the necessary documents in connection with the inquiry.
Further, the Assistant Commissioner of State Tax (“the Assistant Commissioner”) and the State Tax Officer 2 (“the State Officer”) issued summons under Section 70 of the Act to the petitioner and petitioner is asked to supply the necessary documents in connection with the inquiry initiated and further vide communication dated May 10, 2023 sought the documents for further investigation.
The Petitioner contended that the documents are in possession of the DGGI Officer and thus, the Assistant Commissioner and the Sate Officer have no authority to proceed further with the inquiry in connection with the same subject matter.
The Petitioner relied upon the Section 6(2)(b) of the CGST Act and submitted that the first investigation is initiated by the DGGI Officer in connection with the Petitioner and therefore, it is not open to Assistant Commissioner and the Sate Officer.
Issue:
What would happen if DGGI and other agencies initiated proceedings and sought information from assessee, which is available with one of the agency?
Held:
The Hon’ble Gujarat High Court in R/SPECIAL Civil Application No. 9488 of 2023 held as under:
- Directed, the Petitioner to co-operate with the inquiry initiated by the DGGI Officer and produce all the relevant documents.
- Further directed, the Assistant Commissioner and the Sate Officer to transfer the documents to the for necessary investigation initiated by DGGI Officer.
Our Comment:
The Hon’ble Gujarat High Court by directing for consolidation of documents under a single investigating unit, the court emphasizes the necessity for a cohesive approach in legal proceedings. This judgment provides valuable guidance for situations where multiple agencies have initiated investigations into the same subject matter, promoting efficiency and clarity in such scenarios.
FULL TEXT OF THE JUDGMENT/ORDER OF GUJARAT HIGH COURT
[1] This petition is filed under Article 226 of the Constitution of India, in which, the petitioner has prayed that the respondent No.1 and 2 be directed to transfer the proceedings in connection with the case of the petitioner along with the documents which are in their possession to Directorate General of GST Intelligence, Vadodara Regional Unit i.e. respondent no. 4 herein. It is also prayed that respondent no.4 be directed to complete the proceedings at the earliest. It is also prayed that the summons issued by concerned respondent no. 1 be quashed and set aside.
[2] Heard the learned advocate Mr. Sahil Rao for the petitioner, learned Assistant Government Pleader Pranav Trivedi for respondents no.1 to 3 and learned Standing Counsel Mr. Priyank Lodha for respondent no.4.
[3] Learned advocate for the petitioner has referred to the averments made in the memo of petition and thereafter submitted that the inspection was carried out by the respondent no.4 at the premises of the petitioner under Section 67(1) of the Central/State Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘CGST Act’). The said investigation was carried out on 10.12.2021 and is still pending before the respondent 4
3.1. It is submitted that, thereafter respondent no.1 & 2 also issued summons under Section 70 of the Act to the petitioner and petitioner is asked to supply the necessary documents in connection with the inquiry initiated by the respondents no.1 & 2. It is further submitted that the petitioner has specifically informed to respondents no.1 and 2 vide communication/reply dated dated 10.05.2023 that the documents as demanded by the concerned respondent, are in possession of respondent no.4 herein and therefore. the respondent no.1 & 2 have no authority to proceed further with the inquiry in connection with the same subject matter.
3.2 It is submitted that in spite of the said reply given by the petitioner on 23.05.2023, another communication has been addressed to the petitioner whereby the petitioner is directed to remain present with the necessary details/documents/evidence to point out that for the same subject matter investigation/inquiry spending before the respondent no.4, therefore, at this stage, petitioner has preferred the present petition.
3.3 Learned advocate for the petitioner has referred and relied upon Section 6(2)(b) of the CGST Act which reads as under:
“(b) where a proper officer under the Central Goods and Services Tax Act has initiated any proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act on the same subject matter.”
3.4 Learned advocate has placed reliance upon Section 6(2)(b) of the CGST Act and submitted that the first investigation/inspection/ inquiry is initiated by the respondent no.4 in connection with the petitioner and therefore, it is not open for the respondents no.1 & 2 herein to inquiry into the same aspects and therefore, respondents no.1 & 2 be directed to transfer the documents/inquiry to respondent no.4. It is submitted that the petitioner will co-operate with the inquiry which is initiated by the respondent no.4. and produce all the relevant/required documents/evidence before the respondent no.4.
[4] Learned AGP Mr. Pranav Trivedi for the respondents after taking instructions from the respondent 1 & 2 has placed on record the communication dated 15.06.2023 addressed by the respondent no.4 to the concerned respondent wherein it has been specifically stated that the respondent no.4 is inquiring into the matter in connection with the five different Firms including Firm viz. M/s. J.M. Enterprise, for which, summons were issued to the petitioner. The said aspect is also clarified by the learned Standing Counsel Mr.Priyank Lodha appearing for respondent no.4.
[5] In view of the aforesaid facts and circumstances of the present case, when the respondent 4 has initiated the inquiry and inspected the documents and carried out the inspection at the place of the petitioner and inquiry is going on in connection with five different Firms at present including M/s. J.M. Enterprise, for which, the summon was issued by the respondent no.1, whereas M/s Galaxy Enterprise, summon was issued by respondent no.2. Hence, we are of the view that the present petition deserves consideration.
5.1 The respondents no.1 & 2 are directed to transfer the papers/documents to respondent no. 4 for necessary inquiry/investigation in connection with both the Firms viz. M/s. J.M. Enterprise and M/s. Galaxy Enterprise.
5.2 The petitioner is directed to co-operate with the respondent no. 4 and produce necessary/required documents demanded by respondent no.4 for the purpose of investigation/inquiry and thereafter, it is open for the respondent no.4 to pass an appropriate order/take appropriate action in accordance with the law.
[6] In view of the above, the petition is allowed to the aforesaid extent.
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