Shivalik International Vs Joint Commissioner of State Tax (Himachal Pradesh High court)
In a ruling addressing procedural overlap in GST investigations, the Himachal Pradesh High Court has directed that a taxpayer, Shivalik International, should not face parallel proceedings from both Central and State GST authorities for the same cause and period. The court’s decision came in response to a petition filed by Shivalik International, challenging summons issued under Section 70 and DRC-01A under Section 74(5) of the CGST/HPGST Act, along with the sealing of their business premises and blocking of credit.
The petitioner argued that the Commissioner, Central Goods and Service Tax, had initiated proceedings under Section 67 of the CGST/HPGST Act, 2017, prior to the Joint Commissioner, State Taxes and Excise-cum-Proper Officer, commencing their independent actions, including a raid and sealing of premises. Shivalik International contended that being subjected to two concurrent investigations for the same alleged irregularities in the same year was unwarranted and without jurisdiction.
The High Court acknowledged the undisputed fact that the Central GST Commissioner had initiated proceedings first. Consequently, the court deemed it appropriate to clarify the jurisdictional authority. The court ruled that moving forward, only the Commissioner, Central Goods and Service Tax, would possess the jurisdiction and authority to deal with Shivalik International under Section 70 of the Act and bring the proceedings to a logical conclusion. While the State authorities are permitted to assist the Central authority in the investigation, they are explicitly barred from initiating any independent proceedings.
