Facts of the Case

M/s.Notch India Projects, holding GSTIN 33AAPFM8787P1Z3, had already suffered an order from the Central authority (Assistant Commissioner of CGST and Central Excise, Madurai II Division) dated 26.12.2023, against which an appeal was pending. Notwithstanding this, the State Tax Officer issued a show cause notice in Form GST DRC-01 dated 27.05.2024, followed by an order in Form GST DRC-07 dated 06.08.2024, on a subject matter overlapping with the Central proceedings. The petitioner challenged the State proceedings as without jurisdiction before the Madras High Court's Madurai Bench.

Issues Involved

  1. Whether the State tax authority could initiate fresh proceedings once the Central authority had already passed a final order on the same subject matter.
  2. Whether the Supreme Court's ruling in Armour Security on Central-State cross-empowerment under Section 6(2) of the GST Act applied to bar the State's action.

Petitioner's Arguments

  • The Central authority had already passed a final order dated 26.12.2023 against which an appeal was pending, so the State authority had no jurisdiction to issue a fresh show cause notice and order on an overlapping subject matter.
  • The recent Supreme Court ruling in M/s Armour Security (India) Ltd. v. Commissioner, CGST, Delhi East Commissionerate (2025) clarified that once one authority passes a final order, the other authority loses jurisdiction to act in the matter.

Respondent's Arguments

  • No specific rebuttal was recorded distinguishing the overlap between the Central authority's order and the State's show cause notice on the same subject matter.

Court Order / Findings

  • The Court relied on paragraph 98 of Armour Security, which called for coordination between Central and State tax administrations to avoid overlapping proceedings and hardship to taxpayers.
  • Since the Central authority had already taken action and passed a final order, the Court held the State authority could not have issued the impugned show cause notice, and the subject matter clearly overlapped, quashing the State proceedings.
  • The writ petition was allowed with no costs, and connected miscellaneous petitions were closed.

Important Clarification

  • Under Section 6(2) of the GST Act, once the Central or State authority to which a taxpayer is assigned passes a final order on a subject matter, the other authority cannot separately initiate or continue proceedings on the same matter.
  • The Armour Security ruling of the Supreme Court is now the guiding precedent for resolving cross-empowerment and overlapping-jurisdiction disputes between Central and State GST authorities.

Sections Involved

  • Section 6(2), CGST Act, 2017 – bars a proper officer from initiating proceedings where another authority has already initiated proceedings on the same subject matter.
  • Form GST DRC-01 and Form GST DRC-07 – prescribed show cause notice and summary order forms under GST demand proceedings.

Decision – In Favour of

Decided in favour of the assessee. The State authority's overlapping show cause notice and order were quashed as being without jurisdiction.

Case Details

Court: Madurai Bench of Madras High Court
Case No.: W.P(MD) No.31614 of 2025 and W.M.P.(MD) Nos.24782, 24784 & 24852 of 2025
Coram: Hon'ble Mr. Justice G.R. Swaminathan
Date of Order: 06.11.2025

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