2019 (6) TMI 1377 - HC - GST

Jurisdiction - power of Dy. Commissioner of State Tax to issue SCN - absence of any specific notification issued by the State Government appointing the Dy. Commissioner of State Tax - Section 74(1) of the Gujarat GST Act, 2017, and Section 74(1) of the CGST Act, 2017 - scope of the expression 'for use' in the context of sale of LPG for domestic use - HELD THAT - The writ-applicant has been able to lay down a strong prima facie case to have an interim order in its favour in terms of Para 48 (c). Let Notice be issued to the respondents, returnable on 17th July 2019.

Summary

Issues:
Challenge to show-cause notice jurisdiction under GST Act, 2017; Interpretation of "proper officer" under Section 2(91) of the Act; Appointment of officers under Section 3 of the Act; Powers of officers under Section 5 of the Act; Compliance with previous court judgment in a similar case.

Analysis:
The judgment by the Gujarat High Court dealt with the challenge to the legality and validity of a show-cause notice issued under the Gujarat Goods and Services Tax Act, 2017, and the Central Goods and Services Tax Act, 2017. The primary argument put forth was regarding the jurisdiction of the Deputy Commissioner of State Tax to issue such a notice. The petitioner contended that the Deputy Commissioner lacked the authority to issue the notice.

The counsel for the petitioner highlighted the definition of "proper officer" under Section 2(91) of the Act, which refers to the Commissioner or an officer assigned by the Commissioner in the Board for any function under the Act. The attention was then drawn to Section 3 of the GST Act, which outlines the appointment of various classes of officers for the Act's purposes. It was argued that no notification had been issued by the Government appointing officers as per the mentioned clauses, except the Commissioner of State Tax.

Further, Section 5 of the Act concerning the powers of officers was discussed. It delineates the powers that an officer of central tax may exercise and delegate. The submission contended that without a specific notification appointing the Deputy Commissioner of State Tax, the issuance of the show-cause notice under Section 74 of the Act was invalid.

Another submission made by the petitioner's counsel referred to a previous judgment by the Court in a similar case, emphasizing the interpretation of the expression "for use" in the context of sales for domestic use. The petitioner argued that the judgment in that case would apply to the current situation, as the notification in question was similarly worded.

After hearing the arguments from both sides and reviewing the evidence, the Court found that the petitioner had established a strong prima facie case for granting interim relief. Consequently, an interim order was issued in favor of the petitioner, with notices to the respondents for further proceedings on a specified date. The Court also directed the matters to be clubbed and heard together with other related cases for efficient adjudication.