HP High Court Mandates Strict Adherence to Supreme Court Guidelines on Overlapping Central and State GST Proceedings
The fundamental architecture of India's dual GST model empowers both federal and provincial tax administrations to enforce compliance. However, this dual structure frequently leads to jurisdictional friction, particularly when an assessee faces simultaneous inquiries from both authorities regarding the exact same transaction. Addressing this critical procedural overlap, the Himachal Pradesh High Court recently delivered a pivotal directive in the matter of H.M. Steels Limited Vs Joint Commissioner.
Adjudicating a writ petition filed under Article 226 of the Constitution of India, the High Court evaluated the legal boundaries of parallel investigations. The core dispute revolved around the statutory embargo placed by Section 6(2)(b) of the Central Goods and Services Tax Act 2017 and the corresponding Himachal Pradesh Goods and Services Tax Act 2017, which strictly forbids the initiation of identical proceedings by one authority if the other has already assumed jurisdiction.
The Genesis of the Jurisdictional Conflict
In the present scenario, the assessee found themselves caught in a crossfire of overlapping administrative actions. The chronological sequence of events highlighted a clear duplication of investigative efforts by both the State and Central tax departments.
Initially, the State GST department assumed jurisdiction by issuing summons to the assessee on 12.02.2024 and 13.02.2024. This was subsequently followed by a formal intimation regarding tax liability via Form DRC-01A on 27.06.2024.
Despite the State authorities already being seized of the matter, the Central GST authorities (specifically the Directorate General of GST Intelligence) launched their own parallel inquiry. The Central administration issued independent summons under Section 70 of the Central Goods and Services Tax Act 2017 on multiple dates, specifically 05.04.2024, 23.04.2024, and 11.05.2024.
The assessee challenged this subsequent intervention by the Central authorities, arguing that the issuance of new summons constituted a direct violation of the statutory prohibition against parallel proceedings. The primary contention was that since the State authorities had already initiated action on the specific subject matter, any further intervention by the Central authorities was legally void and lacked jurisdictional backing.