• Dated 25^th August, 2025

Apex Court Bars Parallel GST Proceedings on Same Subject Matter

Brief Facts

The Supreme Court recently examined the scope of Section 6(2)(b) of the GST law, which prohibits initiation of proceedings on the same subject matter by different Authorities. The matter arose when proceedings were initiated by more than one authority on identical issues, resulting in summons and investigations being conducted simultaneously. The petitioner challenged the duplicity, contending that once one authority had exercised jurisdiction, a second could not intervene in respect of the same issue.

Assessee's Contention

The assessee's principal contention was that the bar contained in Section 6(2)(b) is absolute and must be given its full meaning to prevent harassment and conflicting outcomes. It was submitted that the phrase "any proceedings" is deliberately wide in scope and cannot be confined merely to adjudication proceedings such as assessment or penalty. Instead, it extends to every stage of enforcement action, including search, seizure, summons and investigation. The assessee highlighted that under the GST framework, all proceedings initiated by one authority are visible to the other through the common portal, ensuring full knowledge of ongoing matters.

Therefore, when one authority has already issued notices or initiated an inquiry on a particular subject matter, any further action by another authority would amount to duplication and exceed jurisdiction. The argument further stressed that the GST regime is based on the principles of cooperative federalism and a "single interface" for taxpayers, whereby a business must deal with only one authority in respect of a particular issue. Allowing simultaneous jurisdiction would undermine this core design of GST, disrupt harmony between the Centre and States, and expose taxpayers to unnecessary compliance, repeated summons and conflicting directions.

Department's Contention

The revenue authorities, however, contended that summons or investigation cannot be equated with initiation of proceedings under Section 6(2)(b). According to them, the bar contemplated in the provision applies only once a formal adjudication such as an assessment, demand or penalty proceeding has commenced. They maintained that investigative actions are merely preparatory steps and, therefore, fall outside the scope of the prohibition.

Court's Decision

After an extensive analysis of the statutory framework, relevant circulars, and divergent High Court rulings, the Supreme Court clarified that the legislative intent behind Section 6(2)(b) is to avoid dual control and conflicting actions by different wings of the tax administration. The Court held that the scheme of the GST law was consciously designed to ensure a single interface with taxpayers. Once a proceeding has been initiated by one authority, whether State or Central, another authority is barred from initiating proceedings on the same subject matter. The Court emphasized that investigative steps such as summons, search or seizure, if directed at the same subject matter already being examined, also fall within the mischief sought to be avoided by Section 6(2)(b). Authorities are expected to act in aid of one another rather than engage in parallel action, so as to uphold the spirit of harmony and certainty in the GST framework.

This decision is significant as it settles the long-standing debate on whether summons and investigation are covered by the phrase "initiation of proceedings." By holding that duplication is impermissible, the Court has reinforced taxpayer protection and ensured that the statutory promise of a single interface is not rendered illusory.

BTA's Comment

The judgment provides substantial relief to taxpayers who were often compelled to respond to overlapping actions by multiple authorities. It strengthens the principle that the GST regime must not create compliance burdens beyond what is necessary, particularly where no revenue loss is involved. The ruling will help businesses avoid repetitive summons and investigations, reduce litigation, and promote cooperative federalism between State and Central authorities. By preventing duplication of proceedings, the Court has ensured that taxpayers can engage with the system with greater clarity and certainty, thereby advancing the efficiency and fairness of the GST framework.

^{Armour Security (India) Ltd. v. Supreme Court [2025 INSC 982]}

Author: Sneha Nandi

Edited by: Shaily Gupta