DGGI has power to issue show cause notices: Gujarat High Court

By LE Desk

Ahmedabad, July 1, 2021: The Gujarat High Court has ruled that the Directorate General of GST Intelligence (DGGI) can issue show cause notices. 

The judgement provides relief to the indirect tax department which was taken to court by a Mumbai-based company over its investigation arm’s power to issue tax notices, The Economic Times reported.

The arguments in court were over who at DGGI can issue a notice — whether any official at DGGI or only a few high-ranking officials. The companies that had brought the matter to court said only “proper official” can issue notices and not any official at DGGI.

The high court ruled that DGGI has a right to issue notices, and that the proper officials as defined in the GST framework would include almost anyone working at DGGI.

While “the submissions made by the petitioners may appear very attractive” there was no substance of the same. “A ‘proper officer’ in relation to any function to be performed under the CGST Act means the commissioner or the officer of the central tax, who is assigned that function by the commissioner,” the court ruled, reported The Economic Times.