Facts of the Case:

The petitioner approached the Supreme Court challenging the judgment of the Uttarakhand High Court. It was contended that the tax demand in question was already the subject matter of a statutory appeal pending before the Joint Commissioner (Appeals). Despite the pendency of the appeal, the GST authorities issued a fresh Show Cause Notice dated 21.02.2025 under Section 74 of the CGST Act, 2017 concerning the same demand. According to the petitioner, initiation of fresh proceedings on an issue already under appellate consideration amounted to a jurisdictional error that had not been considered by the High Court.

Issue:

Whether the GST authorities can initiate fresh proceedings under Section 74 of the CGST Act through a Show Cause Notice in respect of the same tax demand that is already pending adjudication before the appellate authority. 

Held That:

The Supreme Court found the petitioner’s contention regarding the jurisdictional defect worthy of consideration. Observing that the petitioner had raised a specific plea that a fresh Section 74 Show Cause Notice had been issued for the very same demand already pending in appeal before the Joint Commissioner (Appeals), the Court issued notice in the Special Leave Petition. As an interim measure, the Court stayed all further proceedings pursuant to the Show Cause Notice dated 21.02.2025 until further orders.

The order indicates that the Supreme Court considers the issue of parallel GST proceedings on the same tax demand to raise a substantial jurisdictional question. Pending examination of the legality of such overlapping proceedings, the Court has granted interim protection by staying further action under the impugned Show Cause Notice. This development could have significant implications for cases where tax authorities seek to initiate fresh adjudication while the same dispute is already under appellate scrutiny.

Case Name: M/s Devendra Construction Vs Deputy Commissioner dated 31.07.2026.

Citation No. 2026 Taxo.online 2261