Central & State GST Authorities Must Coordinate To Avoid Multiple Adjudications On Same Issue: Himachal Pradesh High Court

The Court directed both authorities to coordinate and ensure that the assessee is not subjected to multiple adjudicatory processes on the same subject matter.

Justices Vivek Singh Thakur and Sushil Kukreja examined the issue related to prohibition contained in Section 6(2)(b) of the Central Goods and Services Tax Act, 2017 (“CGST Act”), against the initiation of parallel proceedings on the same subject matter, despite an earlier initiation of proceedings by another jurisdictional authority.

The issue was whether the summons issued by the State GST Authority shall prevail upon the show cause notice issued by the Central Authority under Section 74 of the CGST Act, being 'parallel proceedings' barred by Section 6(2)(b) of the CGST Act.

The assessee/petitioner challenged the action of the Central GST authorities in issuing summons/notices under Section 70 and Show Cause Notice under Section 74 of the CGST Act, 2017, on the ground that an inquiry had been initiated firstly by the State GST Authority in respect of the same subject matter.

It was contended that in view of Section 6(2)(b) of the CGST Act, the Central Authority is barred from initiating any further proceedings.

The State and Central GST authorities submitted that they shall abide by the statutory mandate under Section 6(2)(b) of the CGST Act and the principles laid down in paras 96 and 97 of the judgment of the Apex Court in Armour Security (India) v. Commissioner, CGST, Delhi East Commissionarate & Another AIR 2025 SC 3854.

It was further submitted that appropriate coordination shall be maintained between the authorities to ensure that no parallel adjudicatory proceedings take place.

The bench referred to the case of Armour Security (India), where the Supreme Court held that once one authority—Central or State—has initiated proceedings first in point of time, any subsequent parallel adjudicatory proceedings on the same cause of action by the other authority are barred under Section 6(2)(b).

The Apex Court, in the above case, has emphasised the need to avoid overlapping proceedings and multiplicity, while at the same time clarifying that legitimate investigative steps by either authority may continue so long as they do not result in parallel adjudication.

The bench referred to paras 96 and 97 of Armour Security (India), where it has been laid down that once one authority (Central or State) has initiated proceedings first in point of time, the other authority is barred from commencing parallel adjudicatory proceedings on the same subject matter; however, bona fide steps for investigation, such as summons under Section 70, are permissible unless they amount to initiation of a parallel proceeding; and any subsequent proceedings, if inconsistent with Section 6(2)(b), must give way to the proceedings first initiated.

The bench directed the assessee to appear before the Central Authority and file the response to the Show Cause Notice, so issued, and raise the contentions along with relevant documents in terms of the judgment passed by the Apex Court in the Armour case on or before 15.12.2025.

The bench further directed the State Authority to communicate with the Central Authority to verify the claim of the assessee in terms of Para 97 (c) of the Armour judgment.

The bench stated that both authorities shall coordinate to ensure that the assessee is not subjected to multiple adjudicatory processes on the same subject matter by following the verdict of the Armour Security case.

In view of the above, the bench disposed of the petition.

Case Title: M/s J.B. Rolling Mills Limited v. Union of India & others

Case Number: Civil Writ Petition No.6358 of 2024

Counsel for Petitioner/Assessee: Ajay Vaidya

Counsel for Respondent/Department: Narinder Singh Thakur, Sushant Keprate, Vijay Arora, Sr. Advocate with Aastha Kohli and Hitansh Raj

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