TaxTMI 
TaxTMI 
2024 (1) TMI 287
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....ily on the ground of it being ultra-vires to the power of the Central Government. A further challenge has been laid to the jurisdiction of the Additional Director General of Goods and Services Tax Intelligence in authorizing the other Intelligence Officer to carry out inspection/search proceedings at the premises of the petitioner under Section 67 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as 'CGST Act, 2017'). A consequential challenge has also been made by the petitioner to the issuance of summons dated 06.06.2023 and 14.06.2023 issued by the Intelligence Officer under Section 70 of the CGST Act, 2017 as it has been alleged to have been issued without authority of law. Other issue of an amount of Rs. 40 Lakhs having been deposited under coercion has been raised by the petitioner in the instant petition. (3) The facts of the present case as is pleaded in the writ petition can be capitulated briefly by stating that the petitioner is a partnership firm registered under Goods and Services Tax having GSTIN 09AAYFR5496BIZH and is engaged in the business of work contract services. The Additional Director General, Directorate General of Goods and Services T....
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....er of the Central Government to appoint such class of officers as provided under the Act', Section 2 (91) which defines 'proper officer', Section 2 (25) which defines 'commissioner in the Board', Section 168 which relates to 'power to issue instruction or directions'. According to the learned Counsel, a conjoint reading of Section 2 (91) with Section 168 (2) of the CGST Act, 2017 signifies that the proper officer would be the Commissioner in Board or an Officer of Central Tax, who is assigned that function by the Commissioner in Board and although Commissioner in Board is the proper officer for the purpose of CGST Act, 2017, however, the definition clause does not confer any power on the Commissioner in Board to assign any power/function to the Officer of the Central Tax. Further, according to the learned Counsel, it is Section 5 (3) of the CGST Act, 2017 which confers the power on the Commissioner to delegate his powers to officers who are subordinate to him and thus according to him, a reading of all these sections leads to the inevitable conclusion that the proper officer is Commissioner in Board and he has been conferred with the power to delegate the functions of proper office....
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....tion proceedings and the summons having been issued by the Intelligence Officer of DGSI amounted to conducting parallel proceedings on the same subject matter by two different wings of same authority. According to the petitioner, the DGSI Officers cannot exercise their jurisdiction to conduct any proceeding on the same subject matter which is already being conducted by the Anti Evasion Wing of GST Department. In an another limb of his argument, the learned Counsel vehemently submitted that the coercive action of the respondent has culminated into the recovery of an amount of Rs. 40 Lakhs from the petitioner without issuance of any show-cause notice or finalization of demand pursuant to the adjudication, which is also contrary to Instruction No. 01/2022-23 (GST- Investigation) dated 25.05.2022. The learned Counsel has also referred to the judgment of the Apex Court passed in J.K. Industries Ltd. Vs. Union of India : (2007) 13 SCC 673 to argue that a delegate cannot override the Act either by exceeding the authority or making provisions which are inconsistent with the Act. Judgments of the Apex Court in State of U.P Vs. Renusagar Co. AIR 1988 SC 1737 and Commissioner of Customs Vs Sa....
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....nce the decision taken by the Central Government was only with respect to assigning the powers of Commissioner to certain other officers, who are already recognized as Central Tax Officers, it is well within the power conferred by the enabling Act and such an exercise of power cannot be termed as ultra vires. As regards the summons issued and the money deposited, it has been contended that the summons were issued in June, 2023 and the deposits were also made in the same month, however, the petitioner chose to come to this Court only in December, 2023 and since it is a case of search and the enquiry proceeding is still going on and the same is still not finalized, the present writ is premature. According to them, there is a mechanism to challenge the further proceedings, which have been provided in the CGST Act, 2017 itself and as such the prayer for summons and deposit are not maintainable before this Court in exercise of its writ jurisdiction. Thus, prayer for dismissal of the present petition is made in defence. (11) This Court has given an anxious thought to the pleadings and contention of the parties. The fulcrum of the submission made by the parties are based on the validity ....
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..... (14) No doubt, this Court is clear in its mind that in a taxation statute, any officer performing a function under the said statute must necessarily meet three concomitants, namely, (i) existence of a class/post, (ii) appointment of officers to that said post/class and (iii) assignment of power to the said post/class. Under the CGST Act, 2017, it is seen and as has been rightly contended by the learned Counsel for the petitioner that section 3 of CGST, 2017 creates the class/post of officers and it clearly says that the Government by notification shall appoint the said class of officers for the purposes of CGST Act. Further, Section 4 of CGST, 2017 provides for appointment of officers/additional officers by the Board in addition to the notification by the Government under Section 3 of the CGST Act, 2017. Most significantly, section 5 of the CGST Act, 2017 says that the Board may impose conditions/ limitations on exercise of powers and discharge of duties conferred or imposed on an officer of Central Tax under the Act. It further says that an officer of Central Tax may exercise the powers and discharge the duties conferred or imposed under the GST Act on any other officer of Cent....
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.... may exercise the powers and discharge the duties conferred or imposed under this Act on any other officer of central tax who is subordinate to him. (3) The Commissioner may, subject to such conditions and limitations as may be specified in this behalf by him, delegate his powers to any other officer who is subordinate to him. (4) Notwithstanding anything contained in this section, an Appellate Authority shall not exercise the powers and discharge the duties conferred or imposed on any other officer of central tax. (18) It is apparent from the above that as per section 5 (1) of CGST Act, 2017, it is the Board, which confers and impose such conditions and limitation on an officer of central tax for exercising the powers and duties conferred under the CGST Act, 2017 and section 5(3) of CGST Act, 2017 empowers the commissioner to delegate his powers to any other officer, who is subordinate to him. Further, section 2 (16) of the CGST Act, 2017 says that "Board" means the Central Board of Indirect Taxes and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963). Further, section 3 of the Central Boards of Revenue Act, 1963 relating to Constitution of Central....
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....esaid reasons, this Court is not inclined to hold that the impugned Notification No. 14/2014 dated 01.07.2017 is ultra vires to the powers provided to the Government under the CGST Act, 2017. (22) Since, the present issue is relating to the power related to Inspection, search, seizure, arrest etc. by the DGSI officer, it can be seen from the CGST Act, 2017 itself that the said powers are mentioned under chapter XIV, wherein section 67 of CGST Act, 2017 relates to power of inspection, search and seizure. Section 69 of the CGST Act, 2017 relates to power of arrest, Section 71 of CGST Act, 2017 relates to access to business premises, section 72 of the CGST Act, 2017 relates to officers to assist proper officers and section 70 of the CGST Act, 2017 relates to power to summon persons to give evidence and produce document. Since, the said power invested under section 70 of the CGST Act, 2017 has been an issue in the present writ petition, it would be beneficial to quote section 70 of the CGST Act, 2017 which inter-alia states: "70 (1) The proper officer under this Act shall have power to summon any person whose attendance he considers necessary either to give evidence or to produce a ....
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....nt of function has to be by way of Notification and not by way of Circular in view of Section 167 of the CGST Act, 2017 and in any case, the power was to be invested by the commissioner in Board. This court finds that Section 167 of the CGST Act, 2017 pertains to the delegation of powers by the Commissioner exercisable by any authority or officer under the Act to be exercisable also by another authority or officer as may be specified in the Notification. So far as Section 2(91) of CGST Act, 2017 is concerned, it pertains to the proper officer in relation to any function to be performed under the CGST Act, 2017 to be the Commissioner or the officer of Central Tax, who is assigned that function by the Commissioner in the Board. Here the Board means the "Central Board of Indirect Taxes and Customs" as defined in Section 2(16) of the CGST Act, 2017. Vide the Circular dated 5.7.2017 the said Board namely the Central Board of Excise and Customs in exercise of the powers conferred by Section 2(91) of the CGST Act, 2017 read with Section 20 of the IGST Act and subject to Section 5(2) of the CGST Act, 2017 has assigned the officers the functions as that of proper officers in relation to the....