Section 6(2)(b) Bar Does Not Prohibit Parallel GST Proceedings Involving Different Financial Years and Infractions

The Petitioner, a partnership firm registered under the GST Act, challenged an Order-in-Original dated 30.09.2025

Previously, Respondent No. 2 issued a notice under Section 73 of the SGST Act for FY 2019–2020 regarding excess ITC availment, resulting in a confirmed demand on 27.08.2024

Subsequently, Respondent No. 1 issued a notice under Section 74 of the CGST Act for FY 2018–2019 alleging wrongful ITC availment from a non-existent firm, M/S Sawariya Traders

The Petitioner contended that the second proceeding was barred by Section 6(2)(b) of the CGST Act as a parallel proceeding on the same subject matter and was conducted in violation of natural justice

1. Whether the proceedings initiated under Section 74 of the CGST Act for FY 2018–2019 were barred by Section 6(2)(b) due to prior proceedings under Section 73 for FY 2019–2020

2. Whether the impugned order dated 30.09.2025 was passed in violation of Section 75(4) of the CGST Act regarding the right to a personal hearing and consideration of submissions

The court applied Section 6(2)(b) of the CGST Act, which prohibits parallel proceedings by State/Central officers on the "same subject matter"

It clarified that this bar applies only when proceedings involve the same specific tax liability, the same set of facts, the same contravention, and the same time period

The court also referenced Section 73 (demands involving non-fraudulent discrepancies) and Section 74 (demands involving fraud, willful misstatement, or suppression) as qualitatively distinct species of infractions

Finally, Section 75(4) was noted regarding the necessity of a hearing where an adverse decision is contemplated

The court found that the statutory bar under Section 6(2)(b) did not apply because there was no overlap in the "subject matter." First, the two proceedings related to different assessment periods: FY 2019–2020 and FY 2018–2019

Second, the nature of the infractions differed: the first proceeding concerned discrepancies in tax liability declarations under Section 73, while the second concerned fraudulent ITC claims from non-existent entities under Section 74

The court noted that these are "separate and qualitatively distinct" categories under the Act

Regarding procedural fairness, the court observed that the Petitioner’s reply had been duly considered in the impugned order, thus complying with Section 75(4)

The writ petition was dismissed, and the court directed the Petitioner to avail the efficacious alternative remedy of appeal under Section 107 of the CGST Act

The court allowed the exclusion of the time spent pursuing this writ petition for the purpose of calculating the limitation period for the appeal