Case Law Details
Nathalal Maganlal Chauhan Vs. State of Gujarat (Gujarat High Court)
Conclusion: Commissioner is empowered to delegate his powers to the Special Commissioner or the Additional Commissioners of State Tax and once the powers are delegated for the purpose of Section 69 of the Central Goods and Services Tax Act, 2017, the subjective satisfaction, or rather, the reasonable belief should be that of the delegated authority.
Held: Applicant told that his son, namely P was a proprietor of a proprietary concern running in the name of Lancer Enterprise. According to the applicant, his son had rented the factory premises including the machines of the proprietary concern to one Mr.N for the purpose of manufacturing miscellaneous articles of plastics on job work basis. Few officers from the office of the Commissioner of State Tax visited the residential premises of the applicant and inquired about the whereabouts of his son. It was alleged that the officers harassed the family by their presence in the flat for almost a period of one week. In view of the aforesaid, a Special Civil Application came to be filed in this High Court. Ultimately, the son of the applicant came to be arrested in exercise of power under Section 69 of the Central Goods and Services Tax Act, 2017. The arrest was on the reasonable belief that the son of the writ-applicant has committed offence under Section 132 of the Act 2017. Applicant being the father, whose son had been arrested , was here before this Court questioning the legality and validity of the Notification No.EST/1/Jurisdiction/B.2168 dated 5th July 2017, by which the Commissioner of State Tax has delegated all his powers to the Special Commissioner of State Tax and the Additional Commissioners of State Tax. It was to be noted that the delegation had been authorized expressly under Section 5(3) of the Act. If the Special Commissioner or the Additional Commissioners would have further delegated the power to officers subordinate to them then it was to be interfered however, such was not the case over here. In the impugned notification it had been stated that the functions delegated shall be under the overall supervision of the Commissioner. When the Commissioner stated that his functions were delegated subject to his overall supervision, it did not mean or should not be construed as if he reserved to himself the right to intervene to impose his own decision upon his delegate. The words in the last part of the impugned notification would mean that the Commissioner could control the exercise administratively as to the kinds of cases in which the delegate could take action. Once the powers are delegated for the purpose of Section 69 of the Act, the subjective satisfaction, or rather, the reasonable belief should be that of the delegated authority. The Bench took the view that having regard to Section 69(4) of the Act referred to above, the Commissioner had been empowered to delegate any of his powers. The Bench also clarified that in the absence of the provisions of Section 69(4) of the Act, the Commissioner could not have delegated the quasi-judicial powers conferred upon him by the Act. The power under Section 69 of the Act can be exercised by the authority upon whom the power is delegated provided the delegatee has reasons to believe that the assessee had committed offence under Section 132 of the Act. Therefore, the condition precedent, i.e. ‘reasonable belief’, for the purpose of exercise of power under Section 69 of the Act remained the same.
FULL TEXT OF THE HIGH COURT ORDER/JUDGEMENT
1. RULE returnable forthwith. Mr.Vinay Vishen and Mr.Chintan Dave, the learned AGP waive service of notice of rule for and on behalf of the State respondents.
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