Case Law Details
South Eastern Coalfields Limited Vs Principal Commissioner & Ors (Chhattisgarh High Court)
The Chhattisgarh High Court has granted a stay on the Show Cause Notice (SCN) issued by CGST authorities demanding Goods and Services Tax (GST) on Chhattisgarh Environment & Development Cess under Reverse Charge Mechanism (RCM). The Division Bench, taking note of the legal bar prescribed in Section 6(2)(b), has admitted the intra-Court Appeal against a Single Bench order and stayed the operation of the SCN until the next hearing date. This article provides a summary of the court’s decision and the key arguments presented by both parties.
Detailed Analysis: The appellant, represented by Mr. Rajeev Agrawal with Mr. Pankaj Agrawal, argued that the initial show cause notice issued by State Authorities was dropped after complete adjudication. Subsequently, the Central Authority issued a second SCN without jurisdiction, challenging the payment of GST on Environmental Cess, which was not related to any service rendered. The appellant contends that once the State authorities adjudicate the matter, Section 6(2)(b) of the CGST Act bars the Central Authorities from further action.
In support of this argument, the appellant cited the judgment of the Hon’ble Supreme Court in the case of Godrej Sara Lee Ltd. vs. Excise and Taxation Officer-cum-Assessing Authority and Ors [2023 SCC OnLine SC 95]. The appellant asserts that the show cause notice dated 16.01.2023 issued by the Central Tax Authority is without jurisdiction.
On the other hand, respondents No.1 and 3/CGST, represented by Mr. Ashutosh Singh Kacchawaha, argue that the second show cause notice was not adjudicated on merits, leading to the issuance of a third SCN by the Central Authority on 16.01.2023.
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