2026-VIL-1124-DEL
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SGST High Court Cases

GST - Bar under Section 6(2)(b) of the CGST Act, 2017 against parallel proceedings on the same subject matter - Search at the premises of the Petitioner revealed that the firm issued invoices without any corresponding supply of goods - Petitioner contended that the proceedings were non est since proceedings had already been initiated by the State authority in respect of the same subject matter - Whether the proceedings are barred by Section 6(2)(b) of the Act - HELD - The bar under Section 6(2)(b) is attracted only if the proceedings under the State enactment were initiated prior in point of time and the subject matter of both proceedings is the same - The State proceedings pertain to wrongful availment of ITC on inward supplies arising from reconciliation of turnover declared in GSTR-3B returns, whereas the present proceedings are founded on intelligence and material emanating from the search, alleging issuance of invoices without supply and passing on of ITC, which has no connection with the reconciliation of turnover - The allegations, material relied upon and nature of default being different, the subject matter is not the same and the essential condition is not satisfied - The show cause notice and order cannot be termed non est. – Further, the petitioner was sent repeated notices through speed-post and a further notice on its registered e-mail ID, yet failed to appear on any of the dates, and failed to file any detailed reply to the show cause notice - Having failed to avail the opportunities afforded, the Petitioner cannot at this stage contend that it was left unheard - The contention is rejected - Constitutional validity of Section 16(2)(c) of the CGST Act, 2017 - Petitioner sought a declaration that Section 16(2)(c) is ultra vires Article 14 of the Constitution, as the recipient cannot be held liable for non-payment of tax by suppliers - Whether the Court should interfere with the provision and entertain the writ petition bypassing the statutory alternative remedy - HELD - A Division Bench of the Gujarat High Court had held the provision to be intra vires and not unconstitutional, and the Supreme Court, by a speaking order, affirmed the view taken by the Gujarat High Court - In view of the position being settled by the Supreme Court, there is no reason to take a different view.
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