GST Authority Directed to Not Take Coercive Action on SCN Issued for Period Under DGGI Investigation | HC

Case Details: DRJ Petrochem (P.) Ltd. vs. Sales Tax Officer - [2025] 171 taxmann.com 701 (Delhi)

Judiciary and Counsel Details

• Yashwant Varma & Ravinder Dudeja, JJ.
• Priyadarshi Manish, Ms Anjali Jha Manish & Ms Muskan Saxena, Advs. for the Petitioner.
• Avishkar Singhvi, ASC & Shubham Kumar, Adv. for the Respondent.

Facts of the Case

The petitioner, a registered assessee under the Goods and Services Tax (GST) regime, challenged a Show Cause Notice (SCN) issued by the State GST authority under Section 73 of the Central Goods & Services Tax Act, 2017. The petitioner contended that the SCN was unsustainable as the same tax period was already under investigation and adjudication pursuant to a prior SCN issued by the Directorate General of GST Intelligence (DGGI), Chandigarh. It was argued that parallel proceedings by two authorities for the same tax period would lead to duplicative adjudication, potential conflicting conclusions, and an undue compliance burden. The writ petition was filed before the High Court, seeking relief against the impugned SCN. During the proceedings, the Revenue, relying on the decision in DLF Home Developers Limited v. Sales Tax Officer Class II, AVATO, Govt. of NCT of Delhi & Anr. [WP(C) 11037/2024 dated 26 September 2024], submitted that no coercive steps would be taken under the impugned SCN until the adjudication of the DGGI proceedings was concluded.

High Court Held

The Hon’ble High Court held that when the same tax period is already under investigation by the DGGI, any parallel proceedings initiated by the State GST authority under Section 73 of the CGST Act, 2017, shall remain in abeyance pending the conclusion of the DGGI’s adjudication. The court recorded and accepted the Revenue’s statement that no coercive steps would be taken on the impugned SCN until the DGGI proceedings reached their conclusion. Accordingly, the writ petition was disposed of in these terms.

List of Cases Reviewed

• DLF Home Developers Limited v. Sales Tax Officer Class II, AVATO, Govt. of NCT of Delhi & Anr. [WP(C) 11037/2024 dated 26 September 2024 – (para 3) followed