Back
IN THE HIGH COURT OF JUDICATURE AT MADRAS
T.S. Sivagnanam, Sathi Kumar Sukumara Kurup, JJ.
Kuppan Gounder P.G. Natarajan, Managing Director, M/s. KPN Travels India Ltd. – Appellant
Versus
Directorate General of GST Intelligence – Respondent
W.A. No. 2003 of 2021 & C.M.P. No. 12863 of 2021
Decided On : 01-09-2021
Code of Civil Procedure, 1908 - Indian Penal Code.1860 - Section 228, 193 - CGST Act – Section 70 –Punishment for false evidence - Appellant is Managing Director of a Company registered under Indian Companies Act, 1956, which is engaged in business of transportation - Appellant sought for issuance of Writ of Certiorari to quash summons issued by respondent under Section 70 of Central Goods and Services Tax Act, 2017 - Whether State tax authorities and Central tax authorities enjoy concurrent jurisdiction issue of cross-empowerment of State tax authorities and Central tax authorities – Whether challenge to summons impugned in writ petition was maintainable - Whether formation of belief to satisfy if the conditions specified in statutory provision invoked or met - Held, writ petition and that it is maintainable as against summons issued by respondent - Challenge in said case was a search action carried in said assessee's business premises under Section 67 of Delhi Goods and Services Tax Act, 2017 challenge to action of search was on ground that assessee was put to harassment - Central tax authorities had also conducted search and search action was challenged in a writ petition which was quashed and thereafter State GST authority has subjected assessee to another search action in relation to same period despite assessee being subjected to search action at hands of Central authorities and it was argued that search by State authority is illegal and unlawful and contrary to provisions of Act - One of issues which was considered in said case was with regard to cross-empowerment and taking note of clarification issued by CBEC and also letter Hon'ble Division Bench held that Department shall be bound by circulars and that assessee therein would be at liberty to take action in case action of State and Central authority is overlapping - Hon'ble Division Bench had no occasion to examine effect of Section 6(2)(b) qua Section 70 of CGST Act. Furthermore, in said decision distinction with regard to words proceedings under CGST Act and an inquiry was not subject matter – Court said decision can render no support to case of assessee - In said decision it was held that while exercising writ jurisdiction Court cannot adjudge or test adequacy or sufficiency of grounds and can only go into question and examine formation of belief to satisfy if conditions specified under statutory provision invoked or met - Factual matrix being entirely different in said decision it can render no assistance to case of assessee - Writ Appeal dismissed.
JUDGMENT :
T.S. Sivagnanam, J.
(Prayer: Appeal under Clause 15 of Letters Patent against the order dated 29.07.2021 passed in W.P.No.15708 of 2021 and set aside the same.)
1. This appeal has been filed by the appellant/writ petitioner, challenging the order passed in W.P.No.15708 of 2021, dated 29.07.2021.
2. The appellant is the Managing Director of a Company registered under the Indian Companies Act, 1956, which is engaged in the business of transportation. The appellant sought for issuance of Writ of Certiorari to quash the summons issued by the respondent dated 08.07.2021, under Section 70 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “the CGST Act”).
3. The case of the appellant is that the company, in which the appellant is the Managing Director, was promoted by him, because a pioneer in the transport business and has achieved the present status out of dedication and hard work. The company held by the family members of the appellant as the shareholders and continued to offer bus services to its customers. The appellant received a notice dated 17.12.2020 from the Assistant Commissioner (SC), Salem stating that there are certain discrepancies in the GST returns in GSTR-3B filed by the appellant for the financial years 2018-19 and 2019-20, while compared with the online service providers returns of the appellant viz., GSTR-8. The appellant submitted explanation with appropriate details, vide letter dated 29.12.2020. While so on 19.01.2021, the respondent conducted a search in the premises of the appellant and the appellant would state that they were harassed and their employees were attacked, which necessitated lodging of a complaint with the police concerned and a case had been registered.
4. It is the further case of the appellant that the respondent on 20.01.2021, issued summons to the Managing Director and the Directors of the Company under Section 70 of the CGST Act. This summons, according to the appellant, is devoid of reasons, issued in a mechanical manner. The appellant filed W.P.No.2723 of 2021 challenging the said summons and by order dated 08.02.2021, the Court directed the summons to be kept in abeyance.
5. It is further submitted that the respondent passed an order of provisional attachment under Section 83 of the CGST Act attaching 14 bank accounts, which include that of the Company and the individual bank accounts of the Directors, vide order dated 20.01.2020. This having been brought to the notice of the learned Writ Court, by order orders dated 08.02.2021 and 10.03.2021, the orders of provisional attachment were directed to be lifted. Aggrieved by such order, the respondent preferred W.A.No.984 of 2021 in which, certain interim directions were given on 25.03.2021 directing the order passed lifting the attachment to remain stayed; directing the Authorized Representative of the appellant to appear before the respondent on 29.03.2021 at 11.00 am; an opportunity of personal hearing was granted; and the respondent was directed to pass a speaking order within a time frame. Till final orders were passed, taking note of the submission that the appellant's business activity had been crippled, the representation dated 27.01.2021, was directed to be considered and appropriate interim orders shall be passed, if found tenable, considering the lifting of the provisional attachment in respect of a few Bank accounts to enable the appellant to carry on its business activities. Pursuant to such direction, the respondent had lifted the order of provisional attachment in respect of three Bank accounts, though the appellant sought for lifting the attachment in respect of seven Bank accounts. Aggrieved by the same, the appellant had filed W.P.No.11367 of 2021.
6. The petitioner filed W.P.No.12402 of 2021 challenging the order passed by the respondent dated 01.04.2021, to quash the said order and to release all the Bank accounts, which had been attached.
7. The present appeal, which arises out of the order p
Issuance of summons under Section 70 of the CGST Act is not barred by prior proceedings under Section 6(2)(b) of the same Act.
Section 6(2)(b) of the CGST Act and the Circular dated 05.10.2018 have limited application and are not a bar to multiple search operations and summons issued by multiple agencies in certain circumsta....
The court ruled that the Circular and Section 6(2)(b) of the CGST Act do not prevent multiple jurisdictions from conducting unified investigations when necessary, reaffirming the court's discretion t....
Taxpayer cannot face dual proceedings by Central and State authorities on the same subject-matter under Section 6(2)(b) of the GST Act, establishing a safeguard against double taxation.
Proceedings initiated by one authority under the CGST Act must be concluded by that authority; inquiries do not equate to the initiation of proceedings.
An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers
Please visit our Training & Support
Center or Contact Us for assistance
Scan Me!
India’s Legal research and Law Firm App, Download now!
For Daily Legal Updates, Join us on :
Back to top
