2026-VIL-1096-DEL
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SGST High Court Cases

GST - Maintainability of writ petition against Order-in-Original, Bar under Section 6(2)(b) of the CGST Act, 2017 - Petitioner challenged a Show Cause Notice issued by the DGGI under Section 74 of the CGST Act, and subsequently amended the writ petition to challenge the consequential Order-in-Original passed during the pendency of the writ proceedings - Whether the writ petition against the Order-in-Original ought to be entertained notwithstanding the availability of the statutory appellate remedy - HELD - The existence of an efficacious alternative statutory remedy is a material consideration while exercising discretionary jurisdiction under Article 226 of the Constitution. The fact that the original challenge was instituted when the Show Cause Notice was pending does not alter the position once the adjudicatory proceedings have culminated in an Order-in-Original during the pendency of the writ proceedings - The challenge to the Order-in-Original raises issues concerning the factual and evidentiary foundation of the proceedings, including the nature of the ITC allegedly availed, the suppliers involved, the allegations of fraud, the material relied upon and the alleged overlap between State and Central proceedings, which are matters that can appropriately be examined in the statutory appellate proceedings, the appellate authority being competent to examine the legality and correctness of the adjudication - The requirement of statutory pre-deposit cannot, by itself, furnish a ground for bypassing the statutory remedy - The fact that the petition was initially filed when the Show Cause Notice was pending does not justify continuation of the writ proceedings for adjudication of the challenge to the Order-in-Original once the adjudicatory proceedings have been completed and the order is independently amenable to challenge under Section 107 - The writ petition is dismissed - Bar under Section 6(2)(b) of the CGST Act, 2017 against initiation of proceedings by the Central tax authority on the same subject matter already proceeded upon by the State tax authority - Whether the proceedings initiated by the DGGI concern the "same subject matter" as the proceedings earlier initiated by the State GST authorities so as to attract the bar under Section 6(2)(b) of the CGST Act - HELD - The expression "subject matter" refers to the tax liability, deficiency or obligation arising from a particular contravention which the Department seeks to assess or recover. The statutory bar is attracted only where two proceedings are, in substance, directed towards the same or overlapping tax liability, deficiency or obligation arising from the same contravention - Proceedings concerning distinct infractions not constituting the same subject matter merely because the tax liability or obligation may be similar - The mere fact that two proceedings arise out of the affairs of the same assessee, concern the same general period, or involve ITC cannot, by itself, establish identity of subject matter - The State proceedings under Section 73 concerned alleged availment of ineligible ITC from cancelled/non-existent suppliers, whereas the DGGI proceedings under Section 74 arose from an independent investigation into alleged fraudulent availment of ITC, indicating a distinction in the nature of the allegations forming the basis of the respective proceedings - The mere fact that certain ITC claims or transactions may feature in both proceedings cannot, by itself, lead to the conclusion that the two proceedings concern the identical liability or the same alleged contravention. The statutory prohibition being against initiation of proceedings on the same subject matter and not against every subsequent proceeding concerning the same assessee or a related transaction - The fact that the DGGI proceedings were initiated after the State GST proceedings had commenced does not, by itself, attract the statutory bar - The contention under Section 6(2)(b) does not warrant interference in exercise of writ jurisdiction - Validity of a consolidated Show Cause Notice covering more than one financial year - Whether issuance of a consolidated Show Cause Notice under Section 74 covering multiple financial years is impermissible - HELD - Having regard to the language employed in Sections 73(3) and 74(3), as well as Sections 73(10) and 74(10) of the CGST Act, the statutory scheme does not prohibit issuance of a consolidated SCN covering more than one financial year - The mere fact that the SCN covers more than one financial year cannot, by itself, render the notice without jurisdiction.
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