The Himachal Pradesh High Court addressed the issue of parallel adjudicatory proceedings under GST law in the case of M/s H.M. Steels Limited versus the Joint Commissioner, State Taxes & Excise & Others. The petitioner, M/s H.M. Steels Limited, was subjected to GST inquiries first initiated by the State GST authorities through summons and DRC-01A intimation. Subsequently, the Central GST authorities also issued summons under Section 70 of the CGST Act for the same issue, prompting the petitioner to challenge these actions as prohibited parallel proceedings.
The central issue was whether the Central GST authorities were barred from issuing summons and initiating proceedings under Section 6(2)(b) when the State GST authorities had already commenced action on the same subject matter. The Court, referencing the Supreme Court's ruling in the Armour Security case, clarified that "initiation of proceedings" refers to formal adjudication, such as issuing a show cause notice, rather than preliminary steps like summons or investigation.
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The Court concluded that while one authority cannot initiate parallel adjudication once another has begun, investigative actions can continue provided they do not duplicate adjudication efforts. It emphasized the necessity for coordination between Central and State GST authorities to avoid duplication and ensure efficient resource use, preventing taxpayer harassment. Instead of quashing proceedings, the Court directed the petitioner to comply with summons and allowed authorities to coordinate and proceed according to Supreme Court guidelines.
Order Date - 09 April 2026
Parties: M/s H.M. Steels Limited vs Joint Commissioner, State Taxes & Excise & Others
Facts -
- M/s H.M. Steels Limited, the petitioner, faced GST inquiries initiated first by the State GST authorities through summons and DRC-01A intimation.
- Later, the Central GST authorities also issued summons under Section 70 of the CGST Act for what appeared to be the same issue.
- The petitioner challenged this, arguing that once State authorities had begun proceedings, Central authorities could not initiate parallel action.
- The dispute essentially revolved around whether these actions amounted to prohibited “parallel proceedings” under GST law.
Issue -
- Whether issuance of summons and proceedings by Central GST authorities is barred under Section 6(2)(b) when State GST authorities have already initiated action on the same subject matter?
Order -
- The Court relied heavily on the Supreme Court ruling in Armour Security case, clarifying that “initiation of proceedings” means formal adjudication like issuing a show cause notice—not merely summons or investigation steps.
- It reiterated that once one authority initiates adjudicatory proceedings first, the other authority cannot start parallel adjudication on the same subject matter. However, investigative actions can continue as long as they do not lead to duplication of adjudication.
- The Court highlighted the importance of coordination between Central and State GST authorities to avoid duplication. Authorities must communicate and decide who will proceed, ensuring efficient use of resources and preventing harassment to the taxpayer.
- Applying these principles, the Court held that instead of quashing proceedings outright, proper directions should be issued.
It directed the petitioner to comply with summons and allowed authorities to coordinate and proceed in line with Supreme Court guidelines
