Can both SGST and then CGST proceed with proceedings for same offence and arrest?

Can both SGST and then CGST proceed with proceedings for same offence and arrest?

We have filed a petition before the Hon’ble Gujarat High Court against such an act of CGST.

Brief Facts

Allegation of the department that petitioner is involved in operating multiple firms. The allegation was with respect to 33 firms.

SGST was already aware of all these firms but still alleged and named only 14 firms for which it arrested the petitioner on 01.02.2020. Petitioner was released on bail on 07.03.2020.

After this, the CGST arrested him alleging for his involvement in the remaining 19 firms.

Question before Court

Although petitioner is released on bail but he has challenged the action of the department and asked for the observation of the Hon’ble Court on one very important question that whether both CGST and SGST can do proceedings simultaneously for same cause and also arrest.

Interim Relief by Court

Hon’ble Court as interim relief has pronounced, no further proceedings shall be taken against the petitioner qua the criminal complaint registered by the CGST department.

Hence all proceedings related to the said criminal complaint has stayed with the direction of no coercive action by the Hon’ble Court.

The matter was argued by Advocate Vishal Dave with Advocate Dr Avinash Poddar and Advocate Nipun Singhvi, who submitted before the Court that the registration of the second complaint by the CGST on the same subject matter despite the fact that the first complaint is already registered by the state SGST department is nothing but abuse of power and abuse of process of law as the petitioner cannot be tried again for the same offence. Hence the facts of the doctrine of double jeopardy are attracted.

It was also stated that prior to the complaint of CGST, the complaint of the same offence was filed against the petitioner by SGST under Section 132 of Gujarat Goods and Services Tax Act, 2017. The petitioner was arrested by SGST, surat on 01.02.2020 and was subsequently released on bail on 07.03.2020. As the investigation was already started by the state SGST department, the Central CGST ought to have passed on any new information to the state SGST department for further investigation instead to registering the second complaint on same facts and subsequently illegally arrested the Petitioner, the petition stated.

It was further submitted that earlier the state SGST department had also filed an application for cancellation of bail of petitioner which was rejected by the Surat Court. In the offence filed by the CGST also the petitioner got arrested and was released on bail by the court.

It is further alleged in the petition that, state SGST department had arrested the petitioner for the alleged offence in respect of 14 firms whereas CGST complaint is based on the further intelligence, in the alleged offence with respect to further 19 firms other than the 14 firms covered by the SGST, therefore, as per the complaint it is alleged that in total 33 firms the petitioner was operating for the commission of the alleged offence.

The Petitioner has moved Gujarat High Court vide SCA 7716 of 2020, for quashing of the complaint filed by CGST on June 11 under section 132(1) (b) and 132 (1) (c) of the Center Goods and Services Tax Act, 2017. The complaint by CGST was filed before the Chief Judicial Magistrate, Surat.
*This case is an example of how two arms (CGST/SGST) of the GST framework is playing a role to harass the taxpayers.*

Arresting by both for the same offence, one by one, how far is legal?

Let’s see what the Court observes.