ORDER
1. Learned counsel Sri Md. Shabaz appears for the petitioner through video conferencing.
Sri Dominic Fernandes, learned Senior Standing Counsel for Central Board of Indirect Taxes and Customs, appears for respondents No.1 to 4 and 6.
2. The petitioner’s GST registration was cancelled on 28.12.2019. The show cause notice bearing No.138/2024-25 was issued by respondent No.1 on 23.09.2024 alleging wrongful availment of Input Tax Credit without actual supply. The proposed demand and penalties were issued under Section 122(1)(ii) and 122(1)(vii) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as, “the Act”). The order-in-original confirming the demand was passed on 18.03.2025 and DRC-07 is dated 20.03.2025. In the present proceeding, the petitioner has assailed the order-in-original dated 10.12.2025 arising out of the show cause notice dated 19.06.2025 for the same period of January 2019 to November 2019 alleging that on identical allegations, penalty was proposed and confirmed under Section 122(1)(ii) and 122(1)(vii) of the Act. Against the order-in-original dated 18.03.2025, the petitioner has already filed a statutory appeal on 28.06.2025, which is pending. Against the order-in-original dated 10.12.2025, the present writ petition has been filed, inter alia, on the ground that it is in teeth of Section 6(2)(b) of the Act. The petitioner has also taken the ground of non-issuance of mandatory show cause notice under Rule 142(1A) of the Central Goods and Services Tax Rules, 2017. The petitioner has further assailed the impugned order-in-original on the ground that it would be a clear case of duplication and abuse of process of law and also in violation of the principles of natural justice.
3. In the second proceedings, it is not in dispute that the petitioner has not participated. In the decision relied upon by the petitioner in the case of Armour Security (India) Ltd. v. Commissioner, CGST, Delhi East 111 GST 400/101 GSTL 289 (SC)/(2025) 33 Centax 222 (SC) , the Apex Court has, under the guidelines laid down at paragraph 97 at sub-paragraph (b), observed that when an assessee becomes aware that the matter being inquired into or investigated is already the subject of an inquiry or investigation by another authority, the assessee shall forthwith inform, in writing, the authority that has initiated the subsequent inquiry or investigation. Paragraph 96 summarises the conclusion on the issue of parallel or overlap proceedings. Sub-paragraph (viii) thereof prescribes that where any two proceedings initiated by the Department seek to assess or recover an identical or a partial overlap in the tax liability, deficiency or obligation arising from any particular contravention, the bar of Section 6(2)(b) would be immediately attracted. Sub-paragraph (x) prescribes the twofold test for determining whether a subject matter is “same” it entails, first, determining if an authority has already proceeded on an identical liability of tax or alleged offence by the assessee on the same facts and secondly, if the demand or relief sought is identical.
4. Section 161 of the Act, on the other hand, prescribes the rectification of errors apparent on the face of record by the authority who has passed or issued any decision or order or notice or certificate or any other document, which is apparent on the face of record in such decision or order or notice or certificate or any other document, either on its own motion or where such error is brought to its notice by any officer. The time limit for seeking rectification is six months from the date of issue of such decision, order or notice.
5. In the instant case, rival submissions have been made on the question of overlap and the duty of the assessee to bring it to the notice of the proper officer the overlap in the tax liability, deficiency or obligation arising from any particular contravention. In the present case, the petitioner has not participated in the proceedings. Therefore, it has failed to bring it to the notice of the assessing authority about the proceedings dated 19.06.2025.
6. On the part of the respondents, it is contended that in determining whether the subject matter is same, though the authority may have proceeded on allegations of contravention of Section 122(1)(ii) and 122(1)(vii) of the Act which were alleged in the previous proceedings, but the second test that the demand or relief sought is identical, is not existing in the present case. Therefore, strictly speaking, the plea of overlap should not arise in the present case. Moreover, since the petitioner has already approached the appellate authority against the order-in-original dated 18.03.2025, the petitioner may not have any difficulty in approaching the appellate authority, as the appeal period is not yet exhausted. Furthermore, the appellate authority would have the benefit of comparing both the orders-in-original imposing demand upon the petitioner for the alleged contraventions.
7. Learned counsel for the petitioner submits that since the GST registration of the petitioner has been cancelled with effect from 28.12.2019, the petitioner may not be able to make the pre-deposit against the impugned order-in-original before the appellate authority and a direction may be issued to waive the same.
8. We have considered the submissions of the learned counsel for the parties.
9. The rival points of law are asserted by either of the parties. On the one hand, the petitioner has failed to participate in the second proceedings to bring out the alleged overlap in the proceedings with the earlier proceedings vide the order-in-original dated 18.03.2025. While applying the twofold test, the first part may be satisfied, but the second may not be attracted, as the demand does not appear to be identical to the first imposition of liability. The petitioner has contended, relying upon the observations made by the Apex Court at paragraph 97(b) of the decision in Armour Security (India) Ltd. (supra), that if the aforesaid authorities are not complying with the said guidelines, it would be open for the taxable person to file a writ petition under Article 226 of the Constitution of India.
10. In the facts and circumstances noted above, we are of the considered opinion that the petitioner may seek rectification of the second proceeding under Section 161 of the Act, since the period of six months has not expired from the date of issuance of the order-in-original dated 10.12.2025. If the petitioner is aggrieved by the order-in-original so passed, it may avail the remedy as is permissible in law also before the appellate authority against the order-in-original and the rectification order. If the rectification application is filed by the petitioner within a period of two weeks, the proper officer would entertain and endeavor to decide it in accordance with law within a period of three weeks thereafter after giving an opportunity of hearing to the petitioner as well. Let it be made clear that we have not made any comments on the merits of the case of the parties.
11. The writ petition is accordingly disposed of. There shall be no order as to costs.
Miscellaneous applications pending, if any, shall stand closed.
