Assistant Commissioner Lacks Legal Jurisdiction to Adjudicate

Assistant Commissioner Lacks Legal Jurisdiction to Adjudicate Show Cause Notices Issued by the DGGI

Issue

Whether an Assistant Commissioner has the legal competence and jurisdiction to adjudicate a Show Cause Notice (SCN) issued by the Directorate General of GST Intelligence (DGGI) under the CGST/IGST framework, or if such powers are exclusively vested in higher-ranking officers.

Facts

The Directorate General of GST Intelligence (DGGI) issued a Show Cause Notice (SCN) to the petitioner proposing a tax demand under the Central Goods and Services Tax (CGST) Act.
The Assistant Commissioner acted as the adjudicating authority and passed an Order-in-Original that confirmed the tax proposals outlined in the DGGI’s notice.
The petitioner filed a writ petition before the High Court, explicitly challenging the legal competence and structural jurisdiction of the Assistant Commissioner to adjudicate an SCN originating from the DGGI.
Notification No. 02/2017-Central Tax originally appointed proper officers under Sections 3 and 5 of the CGST Act, read with Section 3 of the Integrated Goods and Services Tax (IGST) Act.
A subsequent amendment via Notification No. 02/2022-Central Tax inserted Clause 3A and Table V into the parent notification.
This amendment specifically mandated that the power to decide DGGI notices under core enforcement sections (including Sections 67, 73, 74, 76, 122, 125, 127, 129, and 130) is vested exclusively in Additional Commissioners or Joint Commissioners who are subordinate to the Principal Commissioners or Commissioners.

Decision

Absence of Jurisdictional Competence: The Assistant Commissioner lacked the statutory competence to adjudicate the DGGI-issued Show Cause Notice, as the law explicitly excludes lower-tier officers from handling these specific enforcement actions.
Violation of Statutory Notifications: The impugned Order-in-Original directly contravened the strict assignment of powers laid down in Notification No. 02/2017-Central Tax (as amended by Notification No. 02/2022-Central Tax) and therefore suffered from a fatal procedural irregularity.
Final Ruling: The High Court quashed the invalid adjudication order and remitted the matter back to the department. The revenue was directed to ensure a fresh de novo order is passed on merits by a competent authority in strict compliance with Notification No. 02/2017, as modified by Notification No. 27/2024. The case was decided in favor of the assessee by way of a remand.

Key Takeaways

Strict Construction of Proper Officer Roles: Jurisdiction under GST law is not interchangeable among officers. An officer cannot assume adjudication powers over specialized notices (like those from the DGGI) unless a specific board notification explicitly assigns that category of cases to their rank.
Fatal Effects of Jurisdictional Defects: If an tax order is passed by an officer lacking the inherent authority to decide that specific matter, the entire order becomes void ab initio (invalid from the start) due to structural and procedural irregularity, regardless of the underlying merits of the tax demand.
Dynamic Tracking of Amending Notifications: Tax administrations and practitioners must continuously track active amendments (such as Notification 02/2022 and Notification 27/2024) because updates to tables and clauses completely shift monetary and administrative boundaries between Assistant, Joint, and Additional Commissioners.

HIGH COURT OF MADRAS

Kay Arr Engineering Services

Assistant Commissioner of GST & Central Excise

C. SARAVANAN, J.

W.P. No. 5854 of 2025
W.M.P. No. 6437 of 2025

JUNE 3, 2026

Ms. Aparna Nandakumar for the Petitioner. Sai Srujan Tayi, Sr. Standing Counsel and Ms. Pooja Jain, Jr. Standing Counsel for the Respondent.

ORDER

1. The petitioner has challenged the Order-in-Original No. 1/2024 dated 16.01.2025 passed by the first respondent. By the impugned order, the proposal in Show Cause Notice No. 38/2024 GST dated 26.06.2024, issued by the second respondent (DGGI), has been confirmed.

2. The learned Senior Counsel for the petitioner would submit that the invocation of the extended period of limitation under Section 74 of the CGST Act, 2017 is not applicable to the facts of the case. It is submitted that the petitioner had bonafidely adopted the classification under S.No. 234 of the First Schedule to Notification No. 1/2017-Central Tax (Rate) (taxed at 5%, later revised to 12%) regarding maintenance charges for wind-operated electricity generators. The Revenue’s allegation that the petitioner suppressed facts to avoid a higher rate under S.No. 135 of the Fourth Schedule (taxed at 14% CGST) is without merit, as the issue arises out of a bona fide interpretation of the classification entries.

3. Adverting to the issue of jurisdiction, the learned Senior Counsel would draw the attention of this Court to Notification No. 02/2017-Central Tax as amended by Notification No. 02/2022 dated 11.03.2022 and further amended by Notification No. 27/2024 dated 25.11.2024.

4. It is submitted that by virtue of the latest amendment, for notices issued by the DGGI, only an officer in the rank of Additional Commissioner or Joint Commissioner is competent to pass the adjudication order whereas in the present case, the impugned order has been passed by the Assistant Commissioner of GST & Central Excise, who lacks the jurisdiction to adjudicate notices issued by the second respondent.

5. The learned counsel for the petitioner further relied on the judgment of this Court in Titan Company Ltd. v. Joint Commissioner of GST & Central Excise (Madras)/(W.P. No. 33164 of 2023), wherein it was categorically held that the authorities cannot bunch multiple assessment years or pass composite orders in a manner that bypasses the individual limitation periods prescribed under the Act.

6. Per contra, the learned Senior Standing Counsel for the respondents would submit that the classification issue is a matter of fact to be adjudicated by the Appellate Authority under Section 107 and cannot be entertained in summary proceedings under Article 226 of the Constitution of India. On jurisdiction, he would refer to the parent Notification No. 02/2017 to argue that the Assistant Commissioner remains a “proper officer” for adjudication and that subsequent notifications only expanded the powers of higher-ranking officers without divesting the first respondent of his authority.

7. Notification No. 02/2017-Central Tax dated 19.06.2017 was issued in exercise of the powers conferred under Section 3 read with Section 5 of the Central Goods and Services Tax Act, 2017, and Section 3 of the Integrated Goods and Services Tax Act, 2017. By virtue of the said notification, the Central Board of Excise and Customs appointed the officers specified therein as “proper officers” and designated the Central Tax Officers subordinate to them, vesting them with all powers under the said Acts and the Rules framed thereunder, in respect of the jurisdiction specified in the table appended thereto, as follows:

“(a)

Principal Chief Commissioners of Central Tax and Principal Directors General of Central Tax,

(b)

Chief Commissioners of Central Tax and Directors General of Central Tax,

(c)

Principal Commissioners of Central Tax and Principal Additional Directors General of Central Tax,

(d)

Commissioners of Central Tax and Additional Directors General of Central Tax,

(e)

Additional Commissioners of Central Tax and Additional Directors of Central Tax,

(f)

Joint Commissioners of Central Tax and Joint Directors of Central Tax,

(g)

Deputy Commissioners of Central Tax and Deputy Directors of Central Tax,

(h)

Assistant Commissioners of Central Tax and Assistant Directors of Central Tax,

(i)

Commissioners of Central Tax (Audit),

(j)

Commissioners of Central Tax (Appeals),

(k)

Additional Commissioners of Central Tax (Appeals)”

8. At the time of issuance of the above notification, there were four tables appended to it, as detailed below:-

Table No.	Heading
1.	Clause 2 – The Principal Chief Commissioners of Central Tax or the Chief Commissioners of Central Tax
2.	Clause 3 – The principal Commissioners of Central Tax or the Commissioners of Central Tax
3.	Clause 4 – The Commissioners of Central Tax (Appeals) and Additional Commissioners of Central Tax (Appeals)
4.	Clause 5 – The Commissioners of Central Tax (Audit)

9. Subsequently, the said notification was amended by Notification No.2/2022 – Central Tax dated 11.03.2022, whereby Clause 3A and Table V were inserted. By virtue of Clause 3A, inserted through the aforesaid amending notification, the Additional Commissioners or Joint Commissioners of Central Tax, subordinate to the Principal Commissioners of Central Tax or Commissioners of Central Tax, were vested with the powers specified in the corresponding entry under Column (3) of Table V.

10. Table V, as extracted from the amending notification, reads as follows:-

TABLE V

Powers of Additional Commissioner or Joint Commissioner of Central Tax for passing an order or decision in respect of notices issued by the officers of Directorate General of Goods and Services Tax Intelligence.

Sl. No.	Principal Commissioner or Commissioner of Central Tax	Powers (Exercisable throughout the territory of India)
(1)	(2)	(3)
1.	Principal Commissioner Ahmedabad South	Passing an order or decision in respect of notices issued by the officers of Directorate General of Goods and Services Tax Intelligence under Sections 67, 73, 74, 76, 122, 125, 127, 129 and 130 of Central Goods and Services Tax Act 2017.
2.	Principal Commissioner Bhopal
3.	Principal Commissioner Chandigarh
4.	Commissioner Chennai South
5.	Principal Commissioner Delhi North
6.	Principal Commissioner Guwahati
7.	Commissioner Rangareddy
8.	Principal Commissioner Kolkata North
9.	Principal Commissioner Lucknow
10.	Commissioner Thane

11. Thus, in respect of notices issued by officers of the Directorate General of Goods and Services Tax Intelligence (DGGI), namely the second respondent herein, only the Additional Commissioner or Joint Commissioner of Central Tax has been notified / designated to pass orders.

12. However, the impugned Order-in-Original No.1/2024-GST dated 16.01.2025 has been passed by the first respondent, which is clearly contrary to Notification No.2/2022 – Central Tax dated 11.03.2022. Therefore, the impugned order suffers from procedural irregularity and has been passed in violation of the aforesaid notification.

13. Therefore, the impugned order is liable to be quashed and accordingly, the same is quashed and the case is remitted back to pass a fresh order by any competent authority as per Notification No. 02/2017-Central Tax dated 19.06.2017 modified by Notification No. 27/2024 dated 25.11.2024 on merits and in accordance with law, as expeditiously as possible, in terms of the aforesaid notification and by exercising jurisdiction thereunder.

14. Needless to state, before passing the final order, an opportunity of hearing shall be afforded to the petitioner.

15. This Writ Petition stands disposed of with the above observations. No costs. Connected Writ Miscellaneous Petition is closed.