The Delhi High Court has held that the parallel enquiry cannot be conducted by the State and Central GST authorities.
The bench of Justice Yashwant Varma and Justice Harish Vaidyanathan Shankar has quashed the show cause notice in light of the investigation which has been initiated by the Directorate General of GST Intelligence in terms of a SCN. The SCN proceedings are yet to be concluded.
The petitioner/assessee has challenged the Show Cause Notice and which had alleged a violation of Rule 21(c) of the Central Goods and Services Tax Rules, 2017. In terms of that SCN and in view of further proceedings being taken thereon, the Goods and Services Tax registration of the petitioner also came to be suspended with effect from 25 April 2024.
The petitioner contended that a parallel enquiry cannot be conducted by the State and Central GST authorities. This in light of the mandatory prescriptions which stand enshrined in Section 6(2)(b) of the Central Goods and Services Tax Act, 2017.
The court while going through the counter affidavit which has been handed over by the State GST authoritiesnoted that the pendency of proceedings before the DGGI is conceded. The validity of the impugned SCN dated 25 April 2024 is not sustainable.
The court accorded liberty to the State GST authorities to transmit all material information that may be in their possession and which may be considered as relevant to the inquiry presently being undertaken by the DGGI.
Case Details
Case Title: Unity Traders Versus Govt Of NCT Of Delhi
Case No.: W.P.(C) 15847/2024 & CM APPL. 66541/2024 (STAY)
Date: 14.01.2025
Counsel For Petitioner: Aman Kumar Singh
Counsel For Respondent: Mehak Nakra
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