Page 105 - GSTL_2nd April 2020_Vol 35_Part 1

2020 ] DADHICHI IRON AND STEEL PVT. LTD. v. CHHATTISGARH GST 7
the officers of the CGST Act, 2017, the same cannot be simultaneously put to an-
other investigation by the officers appointed under Section 3 of the CGST Act,
2017 in view of the express bar under Section 6(2)(b). According to the Counsel
for the petitioner, the subject matter in both the proceedings is in respect of the
alleged use of fake and fictitious invoices. Thus, the entire subsequent investiga-
tion and the proceedings drawn deserves to be quashed.
10. The Counsel for the respondents No. 2 to 4 opposing the petition
submitted that the writ petition is totally misconceived inasmuch as the grounds
raised by the petitioner in the instant case is not one which is sustainable. Ac-
cording to the petitioner, the show cause notice initially issued was firstly in re-
spect of using of fake invoices for the purpose of input tax credit (ITC) and the
subsequent show cause notice is in respect of the tax demand proposed of Rs. 11
crores on account of dealing with the fake dealers and fake invoices. However
the present investigation, which has been initiated and where one of the Direc-
tors of the petitioner-establishment has been arrested, has been at the instance of
the officers of the Directorate of General of GST Intelligence Wing, which had
received certain secret information in respect of the petitioner issuing fake ITC
invoices worth crores of rupees to different firms in the country. According to the
Counsel for the respondents No. 2 to 4, the petitioner was dealing with the fake
transactions by issuance of fake and bogus invoices relating to the transactions of
Steel goods without the actual supply of goods being made and subsequently
these bogus and fake invoices were used for facilitating for the discharge of his
own GST liabilities. Since the offences reflected from the transactions were made
in more than one State, the respondents had all the powers for initiating a pro-
ceeding under the provisions of Section 132 of the CGST Act, 2017.
11. The Counsel for the respondents No. 2 to 4 further referring to the
documents enclosed along with the writ petition submitted that from the perusal
of the records in the course of investigation as of now the respondents have been
able to detect the petitioner of having availed ineligible ITCs of approximately
Rs. 60 crores and the said amount is likely to increase manifold in the course of
further investigation taking into consideration the large number of bogus trans-
actions that the petitioner-establishment have shown to have been made.
12. The further contention of the Counsel for the respondents No. 2 to 4
is that since the nature of offence now being investigated is entirely different
than the proceedings drawn in the show cause notice or the proceedings pending
before the State Authorities are concerned, it would not be hit by the provisions
of Section 6(2)(b). According to the Counsel for the respondents No. 2 to 4, the
present investigation is more in respect of the defrauding of the Government
revenue committed by the petitioner in contravention to the provisions of the
CGST Act and the nature of offence committed by the petitioner is one which
false under the provisions of Section 132(1)(i) and in view of the provision of Sec-
tion 132(5) of the said Act, the offence is also a cognizable offence and is a non-
bailable offence as well. Thus, prayed for the rejection of the writ petition.
13. Having heard the contentions put forth on either side and on pe-
rusal of record and also taking note of the provisions of the Act what clearly re-
flects is that the initial issuance of the show cause notice and the proceedings
drawn were in respect of the intra-State transactions made by the petitioner,
wherein he had used fake and bogus invoices for the purpose of availing ineligi-
ble ITC, whereas subsequent to a secret information being received and further
investigation being made, particularly in the course of a raid, which was con-
GST LAW TIMES  2nd April 2020  169