Calcutta High Court Rules Proper Officers Under CGST Act Have Jurisdiction; Dismisses Writ for Non-Exhaustion of Statutory Remedy

Background and Proceedings
The writ petition challenged an order dated 3 December 2025, passed by the Assistant Commissioner, CGST and CX, Siliguri Division, under Section 74 of the Central Goods and Services Tax (CGST) Act, 2017. The proceedings stemmed from an investigation by the Directorate General of GST Intelligence (DGGI), which included raids on the petitioners’ premises and seizure of incriminating documents. The authorities concluded that the petitioners had availed Input Tax Credit without actual movement of goods, leading to a demand for GST, penalty, and interest.

Petitioners’ Contentions
The petitioners argued that, in light of certain Circulars, the officer who issued the show-cause notice lacked jurisdiction to adjudicate the matter, and that DGGI officers were not ‘proper officers’ under the CGST Act. They also challenged the validity of several Circulars and relied on an unreported Calcutta High Court decision. On merits, the petitioners offered only a general denial and did not substantively contest the findings.

Respondents’ Submissions
The respondents contended that the petitioners had an available statutory remedy of appeal under Section 107 of the CGST Act, which should be exhausted before approaching the writ court. They further argued that the challenge to the Circulars was unfounded, citing relevant judicial precedents.

Court’s Reasoning and Legal Principle
The Court found no merit in the jurisdictional challenge, relying on decisions from the Jharkhand and Gujarat High Courts. It held that, by virtue of notifications and circulars issued under the CGST Act, officers of the DGGI and other designated officers are empowered as ‘proper officers’ to initiate and adjudicate proceedings. The Court specifically cited the notification dated 1 July 2017 and relevant circulars, confirming that the statutory framework assigns such powers appropriately.

The Court also addressed the challenge to the vires of the Circulars, emphasizing that such challenges must be raised promptly and substantiated with strong grounds. Citing Supreme Court and High Court precedents, the Court found no prima facie case for entertaining the challenge to the Circulars or for bypassing the statutory appellate remedy.

Decision and Outcome
The Calcutta High Court dismissed the writ petition, reiterating that the existence of an alternative statutory remedy under Section 107 of the CGST Act generally precludes writ jurisdiction unless exceptional circumstances are demonstrated. The Court found no such circumstances in this case. It clarified that there was no final adjudication on the merits and that the petitioners remain at liberty to pursue their statutory appeal.

This decision reinforces the principle that officers designated as ‘proper officers’ under the CGST Act have jurisdiction to initiate and adjudicate proceedings, and that parties must ordinarily exhaust statutory remedies before seeking writ relief.