HC asks GST dept to drop notices against firm facing audit proceedings

Calcutta High Court says not clear how parallel proceedings can be conducted by three wings of same department

It is yet another case of different wings of the government working in silos without coordinating with each other.

A petition was filed in the Calcutta High Court by R P Buildcon (P) Ltd to quash the notices sent by anti-evasion and jurisdictional officer of the central goods and services tax (CGST) department, as audit proceedings by the same department had been initiated but not completed for financial years 2017-18, 2018-19 and 2019-20.

In fact, the department also contended that the jurisdictional office (range office) and anti-evasion wing had initiated proceedings without knowing that audit proceedings had commenced.

The court asked the department to complete audit proceedings and not to proceed further with the notices issued by anti-evasion wing and jurisdictional office for the same period.

It said it is not clear how in the age of electronic communication such parallel proceedings can be conducted by three wings of the same department for the same period.

Saurabh Agarwal, tax partner at EY India, said a similar view was also adopted by the court in the case of Raj Metal Industries.

"The judgements would help in closing multiple proceedings on the same issue and for the same period where notices were issued by different authorities of the GST department, while saving the time and resources of the tax authorities as well as taxpayers," Agarwal said.