In Brief
The Supreme Court clarified that under Section 6(2)(b) of the Central Goods and Services Tax Act, 2017, the bar on parallel proceedings applies only when a show cause notice (formal adjudicatory proceedings) has been issued, not merely at the stage of summons or search. The Court held that issuance of summons, search, and seizure are evidence-gathering actions, not formal 'proceedings' within the meaning of Section 6(2)(b). Intelligence-based enforcement action can be initiated by either Central or State tax authorities regardless of taxpayer assignment, but audit and detailed scrutiny of returns must be conducted by the assigned authority. The 'subject matter' is determined by the show cause notice and encompasses specific tax liabilities and contraventions. The Court issued comprehensive guidelines for inter-departmental coordination to avoid duplicative proceedings while ensuring effective tax enforcement and cooperative federalism.
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