Calcutta HC: CGST Superintendent Doesn’t Have the Authority to Issue an SCN Under Section 61

The Calcutta High Court has ruled that the Central Goods and Service Tax (CGST) Superintendent has no authority to issue a show cause notice (SCN) under Section 61 of the CGST Act, 2017.

The appellants, M/s. Gopeshwar Iron and Steel Works Private Limited and Anr. argued whether the respondent authority could proceed with a notice dated 17.04.2023, claiming to be issued under Section 61 of the CGST Act, 2017.

The Audit Department had previously issued a notice on April 5, 2021, requesting various documents. After the appellants furnished the essential documents and the Audit Department approved, the case was closed on March 25, 2022.

During the same period, the DGGI had also issued a summons, and the appellants submitted documents for a pending matter before the DGGI. Section 61 of the CGST Act deals with return scrutiny in accordance with sub-section (3) of Section 61, and it was argued that if no satisfactory explanation is provided by the assessee or if corrective measures are not taken in their return, the appropriate officer can take action, including those under Section 65 of the Act.

The Superintendent, CGST & Central Excise, L, does not have jurisdiction in issuing the impugned notice dated 17.04.2023 in the writ petition. The appellants argued that the notice dated 17.04.2023 issued by the Superintended, Range 1, the documents which have been requested are similar and considered accordingly by the department.

It was also submitted that the documents requested in this notice were already addressed by the Audit Department, making the notice without jurisdiction.

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The respondents’ standing counsel mentioned receiving instructions from the Analytical Wing of the Department, causing the Superintendent to issue the notice dated 17.04.2023.

The bench, comprising Chief Justice T S Sivagnanam and Justice Hiranmay Bhattacharyya, ruled that the notice issued by the Superintendent, CGST & Central Excise, L-1, Circle-III, Durgapur 1 Division, Durgapur dated 17.04.2023 must be kept stayed until the disposal of the writ petition (WPA 10506 of 2023). The respondent was ordered to file an affidavit-in-opposition in the writ petition, after which the petition would be heard and decided on its merits adhering to the law.