2024 (2) TMI 1183 - HC - GST

Superintendent's Tax Credit Order Overturned: Monetary Jurisdiction Breach Invalidates Circular Under Section 73 of CGST Act

HC found the Superintendent's order u/s 73 of CGST Act exceeded prescribed monetary jurisdiction of Rs. 10,00,000 per circular. The impugned order ... Jurisdiction - order under Section 73 of the CGST Act, 2017 - Circular No.31/05/2018-GST dated 9th February, 2018 - input tax credit wrongly availed or utilized - monetary limit for issuance of show cause notice and passing of orders - setting aside for lack of jurisdictionJurisdiction - order under Section 73 of the CGST Act, 2017 - Circular No.31/05/2018-GST dated 9th February, 2018 - monetary limit for issuance of show cause notice and passing of orders - Validity of the impugned order dated 20.11.2023 passed by the Superintendent under Section 73 of the CGST Act in light of the departmental circular prescribing monetary limits for exercise of jurisdiction - HELD THAT: - The respondents conceded on instructions that Circular No.31/05/2018-GST dated 9.2.2018 prescribes the monetary limits for authorities to issue show cause notices and pass orders under Sections 73 and 74 where liability arises from input tax credit wrongly availed or utilized. The circular limits the Superintendent's jurisdiction to matters within the prescribed monetary threshold; in the present case the amount involved exceeded that threshold. On that basis the court found the impugned order to have been passed by an officer lacking jurisdiction. Consequently the order was set aside and the respondents were permitted to proceed afresh in accordance with law. [Paras 4, 5]Impugned order of 20.11.2023 is without jurisdiction and is set aside; respondents granted liberty to initiate proceedings afresh in accordance with law.Final Conclusion: Writ petition allowed; impugned order set aside for lack of jurisdiction and respondents permitted to proceed afresh in accordance with law. Issues involved:The jurisdiction of the Superintendent u/s 73 of CGST Act challenged based on a circular issued by the Government of India, Ministry of Finance, Department of Revenue.Jurisdiction Challenge:The petitioner challenged an order passed by the Superintendent u/s 73 of the Central Goods and Services Tax Act, 2017, disallowing ITC for an amount exceeding Rs. 16,00,000. The challenge was based on the circular dated 9.2.2018, which limited the power of the Superintendent to matters not exceeding Rs. 10,00,000. The respondent conceded that the impugned order was not proper as it exceeded the monetary limit set by the circular. Consequently, the High Court found the order to be without jurisdiction and set it aside, granting liberty to the respondents to proceed afresh in accordance with the law. The writ petition was allowed.Conclusion:The High Court, in a case challenging the jurisdiction of the Superintendent u/s 73 of the CGST Act, found the impugned order to be without jurisdiction as it exceeded the monetary limit set by a circular issued by the Government of India, Ministry of Finance, Department of Revenue. The order disallowing ITC for an amount exceeding Rs. 16,00,000 was set aside, and the respondents were granted liberty to proceed afresh in accordance with the law.