Proceedings initiated under CGST Act cannot be initiated under Odisha GST Act: Orissa HC

Ani Technologies Pvt. Ltd. Vs Additional Commissioner of Commercial Taxes and GST Officer (Orissa High Court)

Orissa High Court granted stay based on provisions covered u/s. section 6(2)(b) of the Odisha Goods and Services Tax Act, 2017 which states that proceedings already initiated under Central Goods and Services Tax Act cannot be initiated again under Odisha Goods and Services Tax Act.

Facts- Vide the present petition, the petitioner challenges show cause notice dated 12^th September 2022 culminating in order dated 29^th August 2024 containing aggregate demand of Rs. 16,08,870/-. Petitioner drew attention towards notice dated 31^st March 2022 issued by Directorate General of GST Intelligence (DGGSTI) covering period 2019-20. The adjudication of the same is awaited before the Additional / Joint Commissioner of Central Goods and Services Tax, Office of the Principal Commissioner of Central Tax.

Petitioner contested that as per section 6(2)(b) of the Odisha Goods and Services Tax Act, 2017 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.

Conclusion- Held that in the circumstances, petitioner’s reliance on clause (b) under sub-section (2) in section 6 renders prima facie satisfaction for staying, at this stage, impugned order till next date of hearing. Mr. Mishra protests on submission that no adjudication will be done pursuant to said show cause notice dated 31st March, 2022 issued by the Issuance of impugned show cause notice and order are the action taken pursuant to said show cause notice.

FULL TEXT OF THE JUDGMENT/ORDER OF ORISSA HIGH COURT

1. Sachdeva, learned advocate appears on behalf of petitioner and submits, under challenge is show cause notice dated 12^th September, 2022 culminating in order dated 29^th August, 2024 containing aggregate demand of ₹16,08,870/-. He submits, the notice and demand were issued by the State authority. He draws attention to show cause notice dated 31^st March, 2022 issued by the Directorate General of GST Intelligence (DGGSTI) addressed, inter alia, to his client at its registered address in Bhubaneswar. He demonstrates, the period covered by the notice requiring reply as to why demand should not be made in respect of his client’s operation in Odisha, is for year 2019-20. He then draws attention to paragraph-28.9 (internal page 62) of show-cause notice to demonstrate that reply against demand of total amount of ₹8,53,6921/-(GST) was sought from his client. On query he submits, reply has been filed to the notice and adjudication awaited before the Additional/Joint Commissioner of Central Goods and Services Tax, Office of the Principal Commissioner of Central Tax, Chennai South. The authority is the appropriate officer duly authorized in that behalf.

2. He draws attention to clause (b) under sub-section (2) in section 6, Odisha Goods and Services Tax Act, The clause is reproduced below.

“(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.”

He submits, impugned show cause notice and order relate to same period and therefore were made without authority. He seeks interference.

3. Mishra, learned advocate, Standing Counsel appears on behalf of opposite party no.1 (State Authority). He hands up documents on copies circulated. First is intimation dated 7^th June, 2022 from the Central Authority to the State Authority, informing issuance of the show cause notice referred to by Mr. Sachdeva. Second document is departmental circular dated 9^th February, 2018 issued by the Commissioner in Government of India, Ministry of Finance (Department of Revenue). Relying on paragraph-6 in the circular he points out, DGGSTI is not the adjudicating authority. Hence, reliance upon show cause notice dated 31^st March, 2022 issued by the DGGSTI should not cause interference. Drawing further attention to the notice, he points out there was request to the State authority to, inter alia take further necessary action. In taking such action impugned show cause notice and order were made.

4. Kedia, learned advocate, Jr. Standing Counsel appears on behalf of opposite party nos.2 and 3 and submits, his client conducted the investigation which resulted in issuance of the show cause notice by the Central authority.

5. On query from Court, we have not been told of a point in time where adjudication commences after issuance of show cause notice. In the circumstances, petitioner’s reliance on clause (b) under sub-section (2) in section 6 renders prima facie satisfaction for staying, at this stage, impugned order till next date of hearing. Mr. Mishra protests on submission that no adjudication will be done pursuant to said show cause notice dated 31st March, 2022 issued by the Issuance of impugned show cause notice and order are the action taken pursuant to said show cause notice.

6. Counter be filed by 18^th October, Petitioner may file rejoinder, to be accepted on adjourned date upon advance copy served.

7. List on 21^st October, 2024 along with WP(C) no.17502 of 2024.