The Madras High Court, while upholding the validity of the show-cause notice issued by DGGI officers held that these officers are “Central Excise officers” for the purpose of exercising various functions under the Central Excise Act and Finance Act, 1994.
Justice C Saravanan was considering a bunch of writ petitions filed against the impugned Show Cause Notices (SCNs) issued by the Additional Director General, Directorate of GST Intelligence of the respective Zonal Units. Before the High Court, the petitioners including M/s Sun Tv Network and IL & FS Tamil Nadu Power Corporation Ltd, contended that the officer of Directorate of Central Excise Intelligence (DGCEI), presently The Directorate of GST Intelligence, are not “Central Excise Officer” and cannot exercise function Pan India.
Relying on the Office Order No.07/Ad(IV)2017 (F.No.A-11013/18/2017-Ad.IV), dated 12.06.2017, the Court observed that the officers of Directorate General of Central Excise Intelligence are “Central Excise Officers” for the purpose of Section 2(b) of the Central Excise Act, 1994. They are empowered to exercise power pan India under Notification No.38/2001-C.E. (N.T), dated 26.06.2001.
Citing a Notification No.22/2015-ST dated 16.9.2014, the Court observed that pan India powers have been vested with the officers from the ”Directorate of Central Excise Intelligence (DGCEI) [presently The Directorate of GST Intelligence]” and contrary to the restriction under Rule 3 of the Service Tax Rules, 1944 also fails.
“The power of the Board under Notification 22/2014-ST dated 6.09.2014 cannot be read in a restricted manner. There is no impediment in appointing the officers of Directorate General of Central Excise Intelligence as “Central Excise Officers” to exercise the power pan India,” the Court said.
The Court held that b virtue of the Notification No.7/2004-C.E. (N.T.), dated 11.03.2004, the officers specified in Column (2) of the Table to the said Notification were appointed as the “Central Excise Officers” and were invested with the powers to be exercised by them “throughout the territory of India” as are exercisable by the Central Excise Officer of the corresponding rank as specified in the Column (3) of the said Table, such powers being the powers of a Central Excise Officer conferred under Chapter V of the Finance Act, 1994.
“Therefore, without doubt, the officers from the Directorate are “Central Excise Officers” as they have been vested with the powers of central exercise officers. Thus, the definition of “Central Excise Officer” in Section 2(b) of the Central Excise Act, 1944 was made applicable for Section 73 of Chapter V of the Finance Act, 1994 which prescribes a machinery for recovery of service tax not levied or paid or short-levied or short-paid or erroneously refunded,” the Court said.
Upholding the show-cause proceedings, the Court concluded that “As mentioned above, under Rule 3 of the Service Tax Rules, 1994, the Board can appoint any other officer to exercise power within the “local limits”. However, that would not mean that the officers of ”Directorate of Central Excise Intelligence (DGCEI) [presently The Directorate of GST Intelligence]” who are already “Central Excise Officers” under Notification No.38/2001-C.E. (N.T), dated 26.06.2001 for whole of India cannot exercise power pan India. Notification No.22/2014-ST dated 6.09.2014 is to be read in conjunction with Notification No.38/2001- C.E. (N.T), dated 26.06.2001.”
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