Madras High Court: In a writ petition against the summons issued by State Tax Officer(‘STO’) and quash the same and further direct the Commissioner of State Taxes and STO to refrain from exercising any control over the petitioner in the guise of cross empowerment of tax authorities under the provisions of Chapter XIV (inspection, search, seizure and arrest) of Central Goods and Service Tax Act, 2017 and Tamil Nadu Goods and Services Tax Act, 2017 (‘TNGST Act’) till relevant notifications are issued in this regard, and until such time, to transfer all the proceedings initiated by the STO to the proper officer working under the control of the Commissioner of GST & Central Excise , for taking further action, Abdul Quddhose, J. held that the petitioner will have to participate in the personal hearing and state all his objections regarding the action launched by the State Authority under the TNGST Act, 2017, as unless and until the petitioner participates in the impugned proceedings the truth cannot be unearthed with regard to the petitioner’s contentions.
The petitioner has challenged the impugned summons on the ground that both the Central and State Authorities do not have powers to initiate proceedings against the petitioner simultaneously under the respective GST Acts regarding the same subject matter.
The petitioner contends that he is already facing proceedings initiated by the Central Authority and therefore, the question of the State Authority initiating proceedings against the petitioner will not arise as per Section 6(2)(b) of the GST Act, 2017.
The petitioner has also submitted a reply to the impugned summons issued by the STO. However, the petitioner apprehends that even without communicating the outcome of the decision taken by the STO, the respondents are, on a day-to-day basis, threatening the petitioner and they have been calling upon the petitioner to come for a personal hearing.
The Court noted that no final decision has been taken by the STO to initiate action against the petitioner under the TNGST Act, 2017. The petitioner has only been called upon to produce documents under the impugned summons and he has also been called to come for a personal hearing. Further, the petitioner did not participate in the personal hearing and instead he filed this writ petition, challenging the impugned summons.
The Court said that to substantiate his defence that he cannot be once again prosecuted by the State Authority under the TNGST Act, 2017, he has to participate in the enquiry to be conducted by the STO and only then it can be ascertained whether the proceedings initiated by the Central and State Authority are one and the same involving the same subject matter.
The Court held that if it is the same subject matter, the State Authority cannot prosecute the petitioner once again as the Central Authority has already initiated action against the petitioner in respect of the very same subject matter. Further, it said that the petitioner has sent a detailed reply to the impugned summons and even without allowing the same to be considered by the STO on merits, the petitioner has approached the Court prematurely by filing this writ petition. Thus, the Court fixed a date for personal hearing before the STO and state all his objections regarding the impugned Summons.
[Tvl Metal Trade Incorporation v. The Special Secretary, Writ Petition No. 3033 of 2023, decided on 06-02-2023]
Judgment by: Justice Abdul Quddhose
Advocates who appeared in this case :
For Petitioner: Advocate Adithya Reddy;
For Respondents: Standing Counsel Sai Srujan Tayi, Government Advocate K. Vasantha Mala.
*Apoorva Goel, Editorial Assistant has reported this brief.