M/S N.S Enterprises vs. Union Of INDIA And 3 Others

Held

The Court held that the Superintendent, CGST, possessed the necessary pecuniary jurisdiction to issue the show cause notice. The Court relied on the clarification provided by the revenue that the CBIC Circular dated 9.2.2018 indeed sets the pecuniary jurisdiction of the Superintendent, CGST, at up to Rs. 10 lac. Since the proposed CGST demand was Rs. 6,80,522/-, which is below the Rs. 10 lac limit, the Superintendent had the authority. The Court also noted that the existence of an equal SGST demand did not affect the Superintendent's CGST jurisdiction, as it was defined with reference to the CGST demand only. As all other grounds pressed by the petitioner were found to be factual in nature and the prima facie conditions for jurisdiction under Section 74 appeared to be met, the Court declined to interfere. The writ petition was disposed of with a direction for the petitioner to file a reply to the show cause notice within four weeks, and for the proceedings to be conducted and concluded strictly in accordance with law and expeditiously.

Facts

The petitioner, M/S N.S Enterprises, filed a writ petition before the Allahabad High Court challenging the jurisdiction of the Superintendent, CGST. The petitioner argued that the Superintendent lacked the pecuniary jurisdiction to issue the show cause notice, relying on a CBIC Circular dated 9.2.2018. The show cause notice proposed a demand of CGST amounting to Rs. 6,80,522/-. The revenue, represented by Shri Gopi Krishna Sood, clarified that the CBIC circular indeed sets the pecuniary jurisdiction of the Superintendent, CGST, at up to Rs. 10 lac. The Court noted that the fact of a potential equal SGST demand did not alter the Superintendent's CGST jurisdiction, which is defined with reference to the CGST demand only. Other grounds pressed by the petitioner were factual in nature.

Key Issues

1. Whether the Superintendent, CGST, has the pecuniary jurisdiction to issue a show cause notice proposing a CGST demand of Rs. 6,80,522/-, in light of the CBIC Circular dated 9.2.2018, which purportedly sets the limit at Rs. 10 lac (CGST)? Petitioner's Argument: The petitioner contended that the Superintendent lacked jurisdiction based on the CBIC Circular dated 9.2.2018, which they understood to limit their authority to CGST demands up to Rs. 10 lac. They argued that the proposed demand fell within this limit, but the challenge was to the Superintendent's authority to issue the notice in the first place. Revenue's Argument: The revenue, through Shri Gopi Krishna Sood, clarified that the CBIC Circular dated 9.2.2018 indeed assigns jurisdiction to the Superintendent, CGST, for demands up to Rs. 10 lac. They further argued that the proposed CGST demand of Rs. 6,80,522/- was within this pecuniary limit. The revenue also stated that any other grounds pressed by the petitioner were factual in nature.