The Calcutta High Court has held that a fresh GST audit under Section 65 of the Central Goods and Services Tax (CGST) Act, 2017 cannot be initiated for periods that have already been audited and adjudicated under Section 73 of the same Act, the reopening is allowed only for uncovered tax periods.
The bench of Justice Raja Basu Chowdhury noted that the State authorities had already completed proceedings under Section 73 for FY 2017–18 to 2019–20. The Central GST department had also adjudicated similar issues for FY 2018–19 to 2021–22. Any further audit for these already adjudicated periods would violate Section 6(2)(b) and the principles of natural justice.
“In view thereof, there being little scope for the respondents to reopen the audit afresh for the periods which have already been covered by the previous audit, the aforesaid audit should be restricted to the periods 2017-2018 and 2022-2023,” the bench ruled.
The petitioner/assessee had challenged a set of audit observations dated January 13, 2025, issued by the Central Tax authorities despite prior adjudications on the same subject matter by State authorities.
The petitioner contended that multiple assessment orders had already been passed by the State GST authorities under Section 73 for the financial years 2017–18, 2018–19, and 2019–20, covering the very issues that the central audit was now seeking to re-examine.
The petition also highlighted that a show-cause notice dated December 19, 2023, and a subsequent order-in-original dated April 25, 2024, had already been issued by the Central GST department for the tax periods 2018–19 to 2021–22. These were based on audit observations which, the petitioner argued, rendered any further audit redundant and violative of Section 6(2)(b) of the CGST Act — a provision that prohibits initiation of proceedings by both Central and State authorities on the same subject matter.
The Court allowed the writ petition partially, directing that the audit for FY 2018–19 to 2021–22 shall not be reopened. Permitted audit proceedings only for FY 2017–18 and 2022–23, periods that had not previously been assessed under Section 73. Directed the authorities to consider a pending representation by the petitioner.
Case Details
Case Title: Abdur Rouf Khan Vs. Superintendent of Central Tax, Kolkata
Case No.: WPA 3987 of 2025
Date: 09/07/2025
Counsel For Petitioner: Prasenjit Das
Counsel For Respondent: Manju Manot Agarwal
