The Supreme Court held on 14 August 2025 in the case of M/S Armour Security (India) Ltd vs Commissioner, Cgst, Delhi that Section 6(2)(b) CGST Act bars the “initiation of any proceedings” on the “same subject matter”. Justices J.B. Pardiwala and R. Mahadevan upheld the High Court’s decision and laid down guidelines with reference to the definition of “proceedings” within the scope of Section 6(2)(b) of the CGST Act.
The petitioner which is a public limited company registered under the Companies Act, 2013 engaged in security services, received a Show Cause Notice (SCN) under Section 73 of the CGST Act for the tax period due to non-reconciliation of turnovers and excess claim of Input Tax Credit (ITC). In a search conducted under Section 67(2) of the CGST Act, electronic gadgets/documents were seized. The petitioner challenged the summons, claiming lack of jurisdiction.
The Court referred to the ratio in G.K. Trading, wherein the High Court of Allahabad interpreted the phrase “subject matter” to mean ‘cause of action’ in relation to the same dispute in a proceeding before a proper officer under the relevant GST enactment. To exemplify upon the scope of issuing show cause notices, the judgement in Gorkha Security Services v. Govt. (NCT of held that the service of a show cause notice is made in order to inform the noticee about the case that has been set up against him, which he has to meet.
The Supreme Court clarified that parallel proceedings cannot be initiated by another tax administration when one of the tax administrations has already initiated intelligence-based enforcement action. The bar in Section 6(2)(b) of CGST Act applies only to formal proceedings (SCNs), not searches/summons. Authorities must coordinate to avoid taxpayer harassment and while Central/State authorities can independently investigate, only one can issue an SCN for the same subject matter. This case made an important differentiation between investigation and adjudication, where the latter is barred if parallel.