Officers authorized by the Director General of GST Intelligence (DGGI) have the authority to issue show cause notices (SCN) for potential Goods and Services Tax (GST) violations.

The Case:

• A departmental store received a demand notice from the GST authorities for Rs 47,41,748 along with interest and penalty.
• The notice claimed the store sold taxable goods under an unregistered brand name without paying the appropriate GST.

The Departmental Store's Arguments:

• The departmental store challenged the notice, arguing it was issued by the wrong authority.
• They cited a circular issued by the Commissioner of Commercial Tax stating only jurisdictional proper officers can issue show cause notices, not inspecting officers.

The GST Authorities' Arguments:

• The GST authorities countered that the notice was a pre-show cause notice (Form GST DRC-01A).
• This is a preliminary step allowing the store to explain their position before a formal show cause notice is issued.
• They also pointed out a central government circular assigning proper officers for issuing such notices.

Court's Decision:

The court sided with the GST authorities on two key points:

• The pre-show cause notice was issued by a competent authority.
• It offered the store an opportunity to be heard before further action.

The court dismissed the petition, allowing the store to respond to the notice and explain why they believe no GST is owed.

Topic-Famina Shopping Mall Pvt. Ltd. VersusThe Assistant Commissioner of GST and Central Excise

Citation-2024 TAXONATION 752 (MADRAS)

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