HC Directs GST Authorities to Avoid Parallel Proceedings Under Section 6(2)(b)

The petitioner, M/s H.M. Steels Limited, approached the High Court challenging summons issued by Central GST authorities under Section 70 of the CGST Act. It was contended that the State GST authorities had already initiated proceedings on the same subject matter through earlier summons and issuance of DRC-01A, and therefore, any subsequent action by Central authorities amounted to parallel proceedings barred under Section 6(2)(b) of the CGST Act.

The respondents submitted that they would adhere to the statutory provisions and the law laid down by the Supreme Court regarding avoidance of overlapping proceedings. It was also argued that investigative actions like summons do not necessarily amount to initiation of adjudicatory proceedings and coordination between authorities would be maintained.

Issue Raised: Whether issuance of summons and initiation of actions by Central GST authorities constitutes impermissible parallel proceedings when State GST authorities have already initiated action on the same subject matter under Section 6(2)(b) of the CGST Act.

HC Held: The High Court disposed of the writ petition by applying the binding principles laid down by the Supreme Court in the Armour Security case. It held that no detailed adjudication was required, as the legal position regarding parallel proceedings under GST law was already settled. The Court clarified that while adjudicatory proceedings on the same subject matter cannot run in parallel, investigative steps such as issuance of summons may continue unless they culminate in overlapping adjudication.

Emphasizing coordination between authorities, the Court directed the petitioner to appear before the Central GST authority and raise all objections along with supporting documents. The petitioner was also directed to comply with summons and inform authorities about overlapping proceedings. Further, the Court directed both Central and State GST authorities to communicate with each other, verify the existence of overlapping subject matter, and ensure that only one authority proceeds with adjudication in accordance with law. It was made clear that the authorities must follow the Supreme Court guidelines to avoid duplication of proceedings. All contentions were kept open, and no opinion was expressed on the merits of the case.

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