Officers under State GST Act are proper officers for CGST Act without Section 6(1) notification unless restrictions imposed

Kerala HC examined a challenge to a show cause notice issued by State Tax Authority allegedly without jurisdiction due to absence of notification under Section 6(1) of CGST Act, 2017. The court held that officers appointed under State GST Act are inherently proper officers for CGST Act purposes, and notification is only required when restrictions or conditions need to be imposed. However, noting conflicting precedent from Madras HC in Tvl. Vardhan Infrastructure case, the court referred the matter to Division Bench for authoritative pronouncement on jurisdictional requirements.

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Issues:
Challenge to show cause notice issued without jurisdiction under CGST Act.

Analysis:
The petitioner, a registered person under CGST/SGST Acts, challenged a show cause notice (Ext. P4) issued by the State Tax Authority, alleging lack of jurisdiction and absence of necessary notification under Section 6(1) of the CGST Act. The petitioner relied on a Madras High Court judgment (Ext. P8) emphasizing the need for proper empowerment under the Act for initiating proceedings. The Senior Government Pleader argued that Section 6(1) of the CGST Act authorizes State Authorities as proper officers, with notification required only for placing restrictions on their powers. A letter from the GST Policy Wing supported this stance, clarifying that no separate notification is needed for cross-empowerment of officers under CGST and SGST Acts.

The Court examined Section 6(1) of the CGST Act, which allows officers under State Goods and Services Tax Act to be proper officers for CGST Act purposes, subject to conditions specified by the Government through notification. The Court interpreted the provision to suggest that State officers are automatically empowered for CGST Act unless restrictions are imposed via notification. Referring to a communication from the GST Policy Wing, the Court concurred with the view that no separate notification is necessary for cross-empowerment, as officers from both State and Central tax administrations are proper officers for all purposes of the Acts.

Citing the Madras High Court's decision in a similar case, the Court noted that proceedings without proper notification for cross-empowerment could be deemed jurisdictionally flawed. The judgment highlighted the importance of adherence to assigned authorities to prevent cross interference, emphasizing that actions by officers not assigned to a taxpayer's jurisdiction are without jurisdiction. Given the potential impact on various proceedings and the conflicting views, the Court decided to adjourn the case for a Division Bench hearing to provide an authoritative pronouncement on the issue.

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