Case Law Details
Tvl. Vardhan Infraastructre Vs Special Secretary (Madras High Court)
In a recent ruling, the Madras High Court addressed a critical issue concerning the jurisdiction of tax authorities under the Central Goods and Services Tax Act, 2017 (CGST Act, 2017) and the Tamil Nadu Goods and Services Tax Act, 2017 (TNGST Act, 2017). The case, titled Tvl. Vardhan Infrastructure vs. Special Secretary, sheds light on the complex interplay between central and state tax authorities in the context of GST enforcement.
The crux of the matter revolved around whether entities assigned to either central or state tax authorities could be subject to investigation and proceedings by their counterparts under the respective GST enactments. Several writ petitions were filed challenging the jurisdiction of the authorities initiating proceedings against them.
Entities assigned to state authorities questioned proceedings initiated by central authorities, while those assigned to central authorities contested actions taken by state authorities. The lack of clarity regarding cross-empowerment through proper notification under Section 6 of the respective GST enactments was at the heart of the dispute.
The timeline of events, starting from the enactment of GST laws in July 2017, revealed efforts by the GST Council to streamline tax administration and prevent overlapping jurisdictions. However, despite initial discussions on cross-empowerment, formal notifications were not issued until much later.
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