Moral Pharmaceuticals Private Limited Vs Union of India (Patna High Court)
Summary: The Patna High Court rejected the challenge by M/s Moral Pharmaceuticals Private Limited to Circular No. 3/3/2017-GST dated 05.07.2017, Circular No. 31/05/2018-GST dated 09.02.2018 and Circular No. 169/01/2022-GST dated 12.03.2022 concerning assignment of functions to Central Tax officers as “proper officers”. The petitioner had questioned the jurisdiction of the officer who issued proceedings under Section 74 of the CGST/BGST Acts and relied, inter alia, upon Canon India Pvt. Ltd. v. Commissioner of Customs.
The High Court agreed with the reasoning adopted by the Bombay High Court in Fomento Resorts & Hotels Ltd. and held that the GST statutory scheme was distinguishable from the Customs Act context considered in Canon India. It held that the Central Government and the Board had exercised powers vested under Sections 3 and 5 of the CGST Act and that the pleas questioning the three circulars had no basis. On the challenge to the adjudication order, the Court noted that the petitioner had filed its reply, produced documents and had been afforded an opportunity of personal hearing. The adjudicating authority ultimately determined tax of ₹2,91,39,160, together with applicable interest, and imposed an equivalent penalty while dropping the balance proposed demand of ₹2,18,60,986.
