The Calcutta High Court has granted interim relief to a registered taxpayer by staying the coercive recovery of a ₹3.91 lakh GST demand.
The Court observed that serious questions arise regarding the jurisdiction of the adjudicating authority that initiated proceedings under Section 74 of the CGST Act, 2017, warranting further judicial examination.
The case is concerned with Dinesh Kumar Goyal, proprietor of M/s Bengal Steel Sales and Industries, who contested a Form GST DRC-01A, a subsequent SCN, and the adjudication order for FY 2019-20.
The taxpayer claimed that while the DRC-01A was issued by a higher-rank officer, the show cause notice and final order were issued by a subordinate officer, making the proceedings without jurisdiction.
The petitioner argued that the show cause notice referenced Section 74(1) but incorrectly referred to Section 73(1) in its body, leading to confusion between cases involving fraud and those that do not.
Additionally, it was contended that the response filed against the DRC-01A was not considered before new proceedings were initiated, which goes against the principles established in the case of SSB Petro Products v. Assistant Commissioner.
In defence, the State asserted that the DRC-01A serves merely as an intimation and does not bar another competent adjudicating authority from issuing a show cause notice. The State also claimed the reference to Section 73 was simply a clerical error and that the proceedings were fundamentally based on Section 74.
After hearing arguments from both parties, Justice Smita Das noted that the issues regarding the competence of the adjudicating authority and the discrepancy in the statutory provisions raise significant jurisdictional questions.
The Court pointed out that the precedent set in SSB Petro Products is relevant, as one officer cannot initiate new proceedings while DRC-01A proceedings before another officer are still pending based on the same cause of action.
Read Also: Karnataka HC Quashes GST Order Over Absence of Fraud Allegation in SCN U/S 74
Accordingly, the Calcutta High Court restrained the GST authorities from taking any coercive action or giving effect to the adjudication order dated 25 March 2026 until the next hearing. The matter has been listed for further proceedings on 8 September 2026.
| Case Title | Dinesh Kumar Goyal vs. Deputy Commissioner of State Tax |
| Case No. | WPA 23312 of 2025 |
| For Petitioner | Ms Sutapa Roy Choudhury, Mr Abhijit Das, and Ms Aratrika Roy |
| For Respondent | Mrs Manju Agarwal, Mr Bijitesh Mukherjee, and Ms Manasi Mukherjee |
| Calcutta High Court | Read Order |
