# M/S Maa Geeta Traders v. Comm. Commercial Tax & Anr

- **Citation:** (2021) 11 ILRA 415
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2020-07-07
- **Case number:** Writ Tax No. 760 of 2021
- **Bench:** Naheed Ara Moonis, Saumitra Dayal Singh
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/m-s-maa-geeta-traders-v-comm-commercial-tax-anr-46570
- **Pages:** 14

## Headnote

Services Tax Act, 2017: Section 2(24), 2(91),
5(3) - Section 5(3) of the Act provides the source of
power to be exercised by the Commissioner for the
purpose of Section 4 read with section 2(91) of the
Act. The power under section 5(3) of the Act is a
general power of sub-delegation vested in the
Commissioner, by the legislature. It is not the
requirement of law that the source of power
must necessarily be recited in the order passed
in exercise of that power to validate the power
exercised. It is enough that the source of
power exercised and it is exercised in the
manner prescribed by law. (Para 25 -27)

There are two different methods to create function
assignment/delegation in favour of officers of "State
tax" and officers of "Central tax" (i.e., officers
appointed
under
the
Central
Act).
Function
assignment/jurisdiction in favour of officers of the
"State tax" may be created by the "Commissioner" by
issuing an order/communication in exercise of his
powers of sub-delegation vested under Section 5(3)
of the Act. However, function assignment/ jurisdiction
in favour of the officers of the Central Act, may be
notified by the State Government which alone has
416 INDIAN LAW REPORTS ALLAHABAD SERIES
power to cause the sub-delegation in favour of those
officers. (Para 38)

Writ Petition Rejected. (E-10)

List of Cases cited:

## Text

_Characters 0–39,940 of 50,592. This is a partial read: ask again with offset=39940 for what follows._

11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
415
extraneous consideration to a refund claim made
under the Entry Tax Act. The provision of
section 40 having been applied mutatis mutandis
to the provision of the Entry Tax Act it would
require, no amount of Entry Tax be refunded to
an assessee unless other specified tax amounts
due against that assessee were first adjusted.

32. However, in the present case, the
petitioner was not seeking any refund under the
Entry Tax Act. Therefore, the provisions of that
Act could not be invoked while rejecting a claim
for refund made under the VAT Act. It is for that
reason, we have chosen to first consider the
interpretation to be given to Section 40(1) of the
VAT Act in the context of a refund claimed
arising under the VAT Act as that is the only
factual and legal context that exists in the
present case. The petitioner has neither claimed
nor appears to be entitled (at this stage) to any
refund under the Entry Tax Act. Therefore, the
submission advanced by learned counsel for the
revenue appears to be totally misconceived and
it cannot therefore be accepted.

33. It is only to deal with the merits of the
submissions advanced by the revenue, we have
chosen to consider the effect of Section 40(1) of
the VAT Act as applied in the statutory context
of the Entry Tax Act. At the same time we
reiterate, the fact situation to apply that
provision to in the context of Entry Tax Act is
plainly non-existent.

34. Thus in the above conspectus the
communications
dated
7.07.2020
and
11.08.2020 are hereby quashed to the extent they
seek to adjust the amount of refund claimed
under the VAT Act, against dues of interest
claimed under the Entry Tax Act. The
respondent is directed to pay out the refund Rs.
17,45,68,741/-, in accordance with law together
with statutory interest due from the date of the
impugned order dated 07.07.2020 till the date of
actual payment.

35. Thus, the writ petition succeeds and is
accordingly allowed. No order as to costs.
----------
(2021)12ILR A415
ORIGINAL JURISDICTION
CIVIL SIDE
DATED: ALLAHABAD 15.11.2021

BEFORE

THE HON'BLE NAHEED ARA MOONIS, J.
THE HON'BLE SAUMITRA DAYAL SINGH, J.

Writ Tax No. 760 of 2021

M/S Maa Geeta Traders ...Petitioner
Versus
Comm. Commercial Tax & Anr.
 ...Respondents

Counsel for the Petitioner:
Pooja Talwar

Counsel for the Respondents:
C.S.C.

A. Interpretation of Statute - U.P. Goods and
Services Tax Act, 2017: Section 2(24), 2(91),
5(3) - Section 5(3) of the Act provides the source of
power to be exercised by the Commissioner for the
purpose of Section 4 read with section 2(91) of the
Act. The power under section 5(3) of the Act is a
general power of sub-delegation vested in the
Commissioner, by the legislature. It is not the
requirement of law that the source of power
must necessarily be recited in the order passed
in exercise of that power to validate the power
exercised. It is enough that the source of
power exercised and it is exercised in the
manner prescribed by law. (Para 25 -27)

There are two different methods to create function
assignment/delegation in favour of officers of "State
tax" and officers of "Central tax" (i.e., officers
appointed
under
the
Central
Act).
Function
assignment/jurisdiction in favour of officers of the
"State tax" may be created by the "Commissioner" by
issuing an order/communication in exercise of his
powers of sub-delegation vested under Section 5(3)
of the Act. However, function assignment/ jurisdiction
in favour of the officers of the Central Act, may be
notified by the State Government which alone has
416 INDIAN LAW REPORTS ALLAHABAD SERIES
power to cause the sub-delegation in favour of those
officers. (Para 38)

Writ Petition Rejected. (E-10)

List of Cases cited:

1. Commissioner of Customs Vs Sayed Ali & anr. 2011
(3) SCC 537 (distinguished)

2. M/s Canon India Private Ltd. Vs Commissioner of
Customs AIR 2021 SC 1699 (distinguished)
(Delivered by Hon'ble Naheed Ara Moonis, J. &
Hon'ble Saumitra Dayal Singh, J.)

1. Heard Ms. Pooja Talwar, learned
counsel for the petitioner, Mr. Manu Ghildyal,
learned Standing Counsel for the revenue.

2. By means of the present petition,
challenge has been raised to the ex-parte
adjudication order dated 07.08.2021 passed by
Deputy Commissioner, Commercial Tax, SectorI, Shajahanpur (hereinafter referred to as the
'Deputy Commissioner), purportedly in exercise
of powers vested under section 74 (9) of the U.P.
Goods and Services Tax Act, 2017 (hereinafter
referred to as the "Act"), for the tax
period/Financial Year 2018-2019.

3. Solitary ground pressed in the present
petition is - lack of inherent jurisdiction with the
Deputy Commissioner to issue a notice, conduct
proceedings and pass the impugned adjudication
order under section 74 of the Act. In the first place,
learned counsel for the petitioner submits, the
Commissioner, State Tax (hereinafter referred to as
the "Commissioner") as defined under section 2
(24) of the Act, is vested with the jurisdiction over
the entire State of Uttar Pradesh to exercise all
powers and perform all or any function under the
Act. The other officers, who may be subordinate to
the "Commissioner" may derive their particular
function-jurisdiction to initiate, continue and
conclude any proceedings in the nature of
adjudication proceedings only under a valid
delegation of power made under section 5 (3) of
the Act. Since no delegation of power existed in
favour
of
the
Deputy
Commissioner,
the
adjudication proceedings initiated and concluded
by that authority lacked inherent jurisdiction. Thus,
relying upon the provisions of section 2 (91) read
with sections 3, 4 and 6 of the Act, it has been
submitted, in the absence of any notification
issued, authorising the Deputy Commissioner to
act as a "proper officer" under the Act, he could
never claim any inherent jurisdiction to pass the
impugned order. In that regard, heavy reliance has
been placed on two decisions of the Supreme
Court in Commissioner of Customs Vs Sayed Ali
and another, reported in 2011 (3) SCC 537 and
M/s
Canon
India
Private
Limited
vs
Commissioner of Customs, reported in AIR 2021
SC 1699.

4. Responding to the above, learned Standing
Counsel for the revenue submitted, section 5(3) of
the Act has no application to the present facts
inasmuch as the Deputy Commissioner is an
officer included in the list of officers described
under section 3 of the Act. Also, relying on the
clear language of the proviso thereto and referring
to the Office Orders dated 01.07.2017 and
19.11.2018, both issued by the Commissioner, in
exercise of powers vested in that Authority under
section 2(91) of the Act read with section 4(2) of
the Act, it has been submitted, the necessary
function assignment contemplated under section 4
of the Act was complete and valid in law, in favour
of the Deputy Commissioner. No other officer
could act as the "proper officer" to initiate, conduct
and/or conclude the adjudication proceedings in
the
case
of
the
petitioner,
for
the
tax
period/Financial Year 2018-19. The decisions cited
by learned counsel for the petitioner are wholly
distinguishable. In those cases, the issue had arisen
in a different statutory and fact context.

5. Having heard learned counsel for the
parties and having perused the record, by the
impugned order, the inward supply received by
11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
417
the petitioner against ten (10) invoices has been
disbelieved. The ITC claim of Rs. 2,92,500/-
each, made under the Act and the Central Goods
and Service Tax Act, 2017 (hereinafter referred
to as the 'Central Act') has been rejected.
Accordingly, penalty has been imposed.

6. Before proceeding further, it may be
relevant to notice certain provisions of the Act.
Section 2 of the Act defines various words,
terms and, phrases used in the Act. Thus, the
term "Commissioner" has been defined in
section 2 (24) of the Act. It reads:

"(24)
"Commissioner"
means
the
Commissioner of State tax appointed under
section 3 and includes the Chief Commissioner,
Principal Commissioner, Special Commissioner
or Additional Commissioner of State tax
appointed under section 3;"

7. Similarly, section 2(91) of the Act
defines the term "proper officer". It reads:

"(91) "proper officer" in relation to any
function to be performed under this Act, means
the Commissioner or the officer of the State tax
who
is
assigned
that
function
by
the
Commissioner;"

8. Section 2(104) of the Act defines the
term "State tax". It reads:-

"104. "State tax" means the tax levied
under this Act;"

9. Then sections, 3, 4, 5 and 6 of the Act,
read as below:

"Section 3. Officer under this Act.-

The Government shall, by notification,
appoint the following classes of officers for the
purposes of this Act, namely:-

(a)
Principal
Commissioner,
Chief
Commissioner or Commissioner of State tax

(b) Special Commissioners of State tax,

(c) Additional Commissioners of State tax,

(d) Joint Commissioners of State tax,

(e) Deputy Commissioners of State tax,

(f) Assistant Commissioners of State tax,

(g) State tax officers, and

(h) any other class of officers as it may
deem fit:

PROVIDED that, the officers appointed
under the Uttar Pradesh Value Added Tax Act,
2008 (U.P. Act No. 5 of 2008) shall be deemed to
be the officers appointed under the provisions of
this Act."

"Section 4. Appointment of officers.-

(1) The Government may, in addition to the
officers as may be notified under section 3,
appoint such persons as it may think fit to be the
officers under this Act.

(2)
The
Commissioner
shall
have
jurisdiction over the whole of the State, the
Special
Commissioner and
an Additional
Commissioner in respect of all or any of the
functions
assigned
to
them,
shall
have
jurisdiction over the whole of the State or where
the State Government so directs, over any local
area thereof, and all other officers shall, subject
to such conditions as may be specified, have
jurisdiction over the whole of the State or over
such local areas as the Commissioner may, by
order, specify."

Section 5. Powers of officer.-

(1)
Subject to such conditions
and
limitations as the Commissioner may impose, an
officer of State tax may exercise the powers and
discharge the duties conferred or imposed on
him under this Act.

(2) An officer of State tax may exercise the
powers and discharge the duties conferred or
imposed under this Act on any other officer of
State tax who is subordinate to him.
418 INDIAN LAW REPORTS ALLAHABAD SERIES

(3) The Commissioner may, subject to such
conditions and limitations as may be specified in
this behalf by him, delegate his powers to any
other officer who is subordinate to him.

(4) Notwithstanding anything contained in
this section, an Appellate Authority shall not
exercise the powers and discharge the duties
conferred or imposed on any other officer of
State tax.

Section 6. Authorisation of officers of
central tax as proper officer in certain
circumstances.-

(1) Without prejudice to the provisions of this
Act, the officers appointed under the Central
Goods and Services Tax Act, 2017 (Act No. 12 of
2017) are authorised to be the proper officers for
the purposes of this Act, subject to such conditions
as the Government shall, on the recommendations
of the Council, by notification, specify.

(2) Subject to the conditions specified in the
notification issued under sub- section (1),-

(a) where any proper officer issues an order
under this Act, he shall also issue an order under
the Central Goods and Services Tax Act 2017 (Act
No. 12 of 2017), as authorised by the said Act
under intimation to the jurisdictional officer of
central tax;

(b) where a proper officer under the Central
Goods and Services Tax Act, 2017 (Act No. 12 of
2017) has initiated any proceedings on a subject
matter, no proceedings shall be initiated by the
proper officer under this Act on the same subject
matter.

(3) Any proceedings for rectification, appeal
and revision, wherever applicable, of any order
passed by an officer appointed under this Act, shall
not lie before an officer appointed under the
Central Goods and Services Tax Act, 2017 (Act
No. 12 of 2017).

10. Also, Section 74 of the Act, under
which impugned proceedings were drawn and
concluded, reads as under:

"Section 74.-Determination of tax not paid
or short paid or erroneously refunded or input
tax credit wrongly availed or utilised by reason
of fraud or any wilful misstatement or
suppression of facts

(1) Where it appears to the proper officer
that any tax has not been paid or short paid or
erroneously refunded or where input tax credit
has been wrongly availed or utilised by reason
of fraud, or any wilful misstatement or
suppression of facts to evade tax, he shall serve
notice on the person chargeable with tax which
has not been so paid or which has been so short
paid or to whom the refund has erroneously
been made, or who has wrongly availed or
utilised input tax credit, requiring him to show
cause as to why he should not pay the amount
specified in the notice along with interest
payable thereon under section 50 and a penalty
equivalent to the tax specified in the notice.

(2) The proper officer shall issue the notice
under sub-section (1) at least six months prior to
the time limit specified in sub-section (10) for
issuance of order.

(3) Where a notice has been issued for any
period under sub-section (1), the proper officer
may serve a statement, containing the details of
tax not paid or short paid or erroneously
refunded or input tax credit wrongly availed or
utilised for such periods other than those
covered under sub-section (1), on the person
chargeable with tax.

(4) The service of statement under subsection (3) shall be deemed to be service of
notice under sub-section (1) of section 73,
subject to the condition that the grounds relied
upon in the said statement, except the ground of
fraud, or any wilful misstatement or suppression
of facts to evade tax, for periods other than
those covered under sub-section (1) are the same
as are mentioned in the earlier notice.

(5) The person chargeable with tax may,
before service of notice under sub- section (1),
pay the amount of tax along with interest
11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
419
payable under section 50 and a penalty
equivalent to fifteen per cent. of such tax on the
basis of his own ascertainment of such tax or the
tax as ascertained by the proper officer and
inform the proper officer in writing of such
payment.

(6) The proper officer, on receipt of such
information, shall not serve any notice under subsection (1), in respect of the tax so paid or any
penalty payable under the provisions of this Act or
the rules made there under.

(7) Where the proper officer is of the opinion
that the amount paid under sub- section (5) falls
short of the amount actually payable, he shall
proceed to issue the notice as provided for in subsection (1) in respect of such amount which falls
short of the amount actually payable.

(8) Where any person chargeable with tax
under subsection (1)pays the said tax along with
interest payable under section 50 and a penalty
equivalent to twenty five per cent. of such tax
within thirty days of issue of the notice, all
proceedings in respect of the said notice shall be
deemed to be concluded.

(9) The proper officer shall, after considering
the representation, if any, made by the person
chargeable with tax, determine the amount of tax,
interest and penalty due from such person and
issue an order.

(10) The proper officer shall issue the order
under sub-section (9) within a period of five years
from the due date for furnishing of annual return
for the financial year to which the tax not paid or
short paid or input tax credit wrongly availed or
utilised relates to or within five years from the date
of erroneous refund.

(11) Where any person served with an order
issued under sub-section (9) pays the tax along
with interest payable thereon under section 50 and
a penalty equivalent to fifty per cent. of such tax
within thirty days of communication of the order,
all proceedings in respect of the said notice shall
be deemed to be concluded.

Explanation 1.- For the purposes of section
73 and this section,-

(i) the expression "all proceedings in respect
of the said notice" shall not include proceedings
under section 132;

(ii) where the notice under the same
proceedings is issued to the main person liable to
pay tax and some other persons, and such
proceedings against the main person have been
concluded under section 73 or section 74, the
proceedings against all the persons liable to pay
penalty under sections 122, 125, 129 and 130 are
deemed to be concluded.

Explanation 2.- For the purposes of this Act,
the expression suppression shall mean nondeclaration of facts or information which a taxable
person is required to declare in the return,
statement, report or any other document furnished
under this Act or the rules made thereunder, or
failure to furnish any information on being asked
for, in writing, by the proper officer."

11. By virtue of section 74 (1) of the Act, a
"proper officer" alone, may issue a notice
requiring any "person chargeable with tax", to
show cause as to the subject matter of that
proceeding. Again, by virtue of section 74 (9) of
the Act, it is the "proper officer" alone, who may
consider the reply that may be submitted by the
concerned "person chargeable with tax" and,
determine the amount of tax, interest or penalty
due upon such person. Therefore, it necessarily
flows from section 74 of the Act, other than a
"proper officer" no other authority under the Act
may pass such an order.

12. As to the description of a "proper
officer", by virtue of section 2(91) of the Act it
has to be either the "Commissioner" himself
and/or the officer of the "State tax", who may
have been assigned that function by the
Commissioner. Here, there is no dispute between
the parties that the Office Orders dated
01.07.2017 and 19.11.2018 were issued by the
"Commissioner" as defined under section 2(91)
of the Act. Its effect will be examined a little
later.
420 INDIAN LAW REPORTS ALLAHABAD SERIES

13. Thus, there would be no dispute
between the parties, if the "Commissioner" had
himself issued the notice or passed the order
giving rise to the present petition. The issues that
arise are whether there is any function
assignment/sub-delegation made in favour of the
Deputy Commissioner, with reference to section
74 of the Act and, whether the assignment made,
if any, validly confers jurisdiction on the Deputy
Commissioner.

14. Then, different provisions of the Act
exist for different purposes. section 3 of the Act
defines the "classes of officers", who may be
appointed under the Act. That provision does not
create any function assignment or sub-delegation
in favour of any class of officers and it does not
define the function jurisdiction of any class of
officers. However, it does create a fiction of law.
Thus, under the proviso thereto it includes, on
deemed basis, all officers appointed under the
U.P. Value Added Tax Act, 2008, to be officers
appointed under the Act. At the same time, no
jurisdiction or function assignment has been
created or sub-delegated in favour of such
officers or class of officers.

15. Then, section 4(1) of the Act,
empowers the State Government to appoint a
person as an officer under the Act, in addition to
the class of officers specified under section 3 of
the Act. Since, the Deputy Commissioner is an
officer falling under the proviso to section 3 of
the Act, section 4(1) of the Act has no relevance
to the present controversy. Insofar as section
4(2) of the Act is concerned, it first specifies the
territorial limits of the jurisdiction of the
"Commissioner",
the
"Additional
Commissioner"
and
the
"Special
Commissioner". The Commissioner has been
vested with territorial jurisdiction over the entire
State. Second, the Special Commissioner and the
Additional Commissioner, would also have
jurisdiction over the whole of the State of Uttar
Pradesh so however, they may exercise that
jurisdiction with respect to all or any of the
functions that may be "assigned"/sub-delegated
to them and where State Government so directs
such jurisdiction may be exercised over any
local area of the State. Crucially, by way of the
third part of section 4 (2) of the Act, all other
officers i.e. officers subordinate to the rank of
Special
Commissioner
and
Additional
Commissioner shall have jurisdiction over the
whole of the State or over such local area as the
Commissioner may by order specify. Thus, so
far as the respondent-Deputy Commissioner is
concerned, his territorial jurisdiction would arise
under the third part of section 4(2) of the Act, by
an order of the Commissioner and subject to
conditions as may be specified by the
Commissioner.

16. In view of the Office Orders dated
01.07.2017 and 19.11.2018, there is no dispute
raised in this petition to territorial jurisdiction of
the
respondent-Deputy Commissioner. The
dispute
is
confined
to
the
function
assignment/sub-delegation if any, made in his
favour. Prima-facie, section 4(2) of the Act does
not appear to directly deal with function
assignment/sub-delegation or creation of subject
matter jurisdiction of the Deputy Commissioner
or any other authority. That provision speaks of
but does not itself provide for or specify/subdelegate function jurisdiction in favour of any
officer under the Act.

17. Clause 1 of the Office Order dated
01.07.2017 first refers to and provides that
jurisdiction specification on the following terms:

Þ1& m0iz0 eky ,oa lsok dj vf/kfu;e 2017 1⁄4m0iz0
vf/kfu;e la[;k 1 lu~ 20171⁄2 dh fofHkUu /kkjkvksa esa
mfYyf[kr d`R; ds laca/k esa mfpr vf/kdkjh 1⁄4Proper
Officer1⁄2 ukfer djus ds mn~ns'; ls vf/kfu;e dh /kkjk 2
1⁄4911⁄2 rFkk /kkjk 41⁄421⁄2 esa iznRr 'kfDr;ksa dk iz;ksx djrs gq, eSa]
vk;qDr] jkT; dj] mRrj izns'k jkT; ds vUrxZr jkT; dj
[k.Mksa ds vf/k{ks= dh HkkSxksfyd lhekvksa dks bl ifji= ds
vuqyXud **d** ds vuqlkj] jkT; dj ds e.Myksa dh
HkkSxksfyd lhek bl ifji= ds vuqyXud **[k** ds vuqlkj]
11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
421
jkT; dj ds lEHkkx ,oa tksau dh HkkSxksfyd lhek bl ifji=
ds vuqyXud **x** ds vuqlkj vo/kkfjr djrk gw¡Aß

18. Insofar as section 5(3) of the Act is
concerned, learned counsel for the petitioner has
vehemently urged, unless the Commissioner first
sub-delegates his specified powers, no function
jurisdiction may arise in favour of the
respondent-Deputy Commissioner. Thus, it is
her
submission,
originally,
all
function
jurisdiction vest in the Commissioner. He may
sub-delegate the same to other officers by
specific orders. In absence of any order issued
under section 5(3) of the Act, the Deputy
Commissioner
never
acquired
function
jurisdiction under Section 74 of the Act.

19. On a plain reading of section 5(3) of
the Act, we find, the Commissioner has been
granted a general power to sub-delegate all or
any of his powers/functions to any other officer
who may be subordinate to him. It would
include within its plain ambit, the sub-delegation
of function jurisdiction or the power to act as the
"proper officer", to adjudicate a dispute under
section 74 of the Act.

20. In absence of any other procedure or
manner being prescribed under the Act to
effectuate or create that sub-delegation or to
create that function assignment, and in face of
the powers vested in the "Commissioner" under
section 4(2) and 5(3) of the Act, we may test the
true purport and scope of the Office Orders
dated 01.01.2017 and 19.11.2018 to determine if
such sub-delegation of power or necessary
function
assignment had
been
made, in
accordance with law.

21.

Clearly,
the
respondent-Deputy
Commissioner is an officer of the "State tax" in
view of the language of the proviso to section 3
of the Act. Even otherwise, there is no dispute to
that, in the present petition. From a plain reading
of section 2(91) of the Act the sub-delegation of
function assignment is to be made by the
Commissioner.
Here,
clearly,
the
"Commissioner" had himself issued the Office
Orders dated 01.07.2017 and 19.11.2018.
Paragraph 2 of the office order dated 01.07.2017
reads as below:-

Þ2& m0iz0 eky ,oa lsok dj vf/kfu;e 2017 1⁄4m0iz0
vf/kfu;e la[;k 1 lu~ 20171⁄2 dh /kkjk 2 1⁄4911⁄2 esa iznRr
'kfDr;ksa dk iz;ksx djrs gq, eSa] vk;qDr] jkT; dj] mRrj
izns'k] mDr vf/kfu;e dh fofHkUu /kkjkvksa ds LrEHk esa uhps
vafdr rkfydk ds LrEHk 2 esa vafdr vf/kdkfj;ksa dks muds
lEeq[k LrEHk 3 esa vafdr vf/kfu;e dh /kkjkvksa ds iz;kstu
gsrq mfpr vf/kdkjh (Proper Officer) ukfer djrk gw¡%&

Ø0
la0
vf/kdkjh
dk
inuke
m0iz0 eky ,oa lsok dj
vf/kfu;e
2017
1⁄4m0iz0
vf/kfu;e la[;k 1 lu~ 20171⁄2
1
1-
[k.M
esa
rSukr jkT; dj
ds mi vk;qDr
2-
[k.M
esa
rSukr jkT; dj
ds
lgk;d
vk;qDr
3-
[k.M
esa
rSukr jkT; dj
vf/kdkjh
10] 35] 54] 61] 62] 63] 64] 65]
66] 671⁄4111⁄2] 68] 70] 73] 74] 75]
76] 78] 79] 81] 123] 126] 127]
129] 130] 142
2
1-
[k.M
esa
rSukr jkT; dj
ds mi vk;qDr
2-
[k.M
esa
rSukr jkT; dj
ds
lgk;d
vk;qDr
25] 27] 28] 30] 60
3
Tksu esa rSukr
la;qDr vk;qDr
dkjiksjsV lfdZy
28] 29] 30] 60] 35] 54] 61] 62]
63] 64] 65] 66] 671⁄4111⁄2] 68] 70]
71] 73] 74] 75] 76] 78] 79] 81]
123] 129] 127] 129] 130] 142
4
1- fo0vuq0'kk0
bdkbZ esa rSukr
jkT; dj ds mi
vk;qDr
 2- fo0vuq0'kk0
bdkbZ esa rSukr
jkT; dj ds
lgk;d vk;qDr
 3- fo0vuq0'kk0
68] 70] 126] 127] 129] 130
422 INDIAN LAW REPORTS ALLAHABAD SERIES
bdkbZ esa rSukr
jkT;
dj
vf/kdkjh
5
1- tksu esa rSukr
jkT; dj ds
la;qDr vk;qDr
1⁄4VSDl vkfMV1⁄2
2- tksu esa rSukr
jkT; dj ds mi
vk;qDr
1⁄4VSDl
vkfMV1⁄2
3- tksu esa rSukr
jkT; dj ds
lgk;d vk;qDr
1⁄4VSDl vkfMV1⁄2

65] 66
6
1- lEHkkx esa
rSukr jkT; dj
ds
la;qDr
vk;qDr
1⁄4dk;Zikyd1⁄2
2- lEHkkx esa
rSukr jkT; dj
ds
la;qDr
vk;qDr
1⁄4fo0vuq0'kk01⁄2

67] 68] 70] 71] 72
7
1- lpyny esa
rSukr jkT; dj
ds mi vk;qDr
2- lpyny esa
rSukr jkT; dj
ds
lgk;d
vk;qDr
3- lpyny esa
rSukr jkT; dj
vf/kdkjh

671⁄4111⁄2] 68] 70] 126] 127] 129]
130

22. Doubts, if any, to any as to overlapping
jurisdictions (amongst the sub-delegates) came
to an end upon issuance of the subsequent Office
Order dated 19.11.2018. Therein, the pecuniary
jurisdiction was dissected and distributed,
exclusively, amongst the officers of the rank of
Commissioner
Tax
Officer,
Assistant
Commissioner and Deputy Commissioner. The
relevant part of that Office Order reads as
below:-

Þ1- fMIVh dfe'uj 1⁄4mik;qDr1⁄2& 50 yk[k ls vf/kd
dj;ksX; foØ;/ku okys fuekZrk bdkbZ rFkk 1 djksM- ls
vf/kd dj;ksX; fcØh djus okyh VasfMax bZdkb;k¡A

2- vflLVsaV dfe'uj 1⁄4lgk;d vk;qDr1⁄2& 15 yk[k ls
50 yk[k rd dj;ksX; foØ;/ku okyh fuekZrk bZdkb;k¡ rFkk
25 yk[k ls 1 djksM- rd dj;ksX; fcØh djus okyh VasfMax
bZdkb;k¡A

3- okf.kT; dj vf/kdkjh 1⁄4jkT; dj vf/kdkjh1⁄2& 15
yk[k rd dj;ksX; fo;/ku fuekZrk bZdkb;k¡ rFkk 25 yk[k
rd dj;ksX; fcØh djus okyh VasfMax bZdkb;k¡Aß

23. The function-jurisdiction that have
been sub-delegated and thus assigned to the
officers falling in the class of officers-Deputy
Commissioner, Assistant Commissioner and the
Commerical Tax Officer are clearly mentioned
in Column-3 of the chart below paragraph 2 of
the Office Order dated 01.07.2017 (quoted
above). Thereby, the function-jurisdiction of
adjudication under Section 74 has been assigned
to the officers of the above mentioned three
classes (specified under Section 3). The
pecuniary jurisdiction of each of the three class
of officers namely, Commercial Tax Officer,
Assistant
Commissioner
and
Deputy
Commissioner has been delineated by the
subsequent Office Order dated 19.11.2018.
Thus, there is no overlapping jurisdiction. Both,
pecuniary and territorial jurisdiction are clearly
demarcated and visible.

24. Then section 5(3) is the source of the
power to sub-delegate the function-jurisdiction
vested in the Commissioner, to be exercised in
favour of any officer subordinate to him. Neither
there exists any procedure or stipulation
prescribed by law with respect to the mode or
the manner in which that power to sub-delegate
may be exercised nor the Commissioner was
required to obtain any approval of the State
Government in that regard nor there exists any
requirement in law prescribing issuance of a
11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
423
notification etc. to evidence a valid subdelegation made under section 5(3) of the Act.

25. Therefore, the fact, composite Office
Orders 01.07.2017 and 19.11.2018 were issued
by the Commissioner, makes no difference to the
validity of the power exercised. Non-recital of
section 5(3) of the Act in either of those orders is
inconsequential and even extraneous to the valid
exercise of power made by the Commissioner.
The power was admittedly existing and it is seen
to have been exercised. It is not shown to have
been exercised in contravention of any statutory
provision or principle of law. Hence, the validity
of the power exercised would remain by
established firm and undoubted.

26. Section 5(3) of the Act provides the
source of power to be exercised by the
Commissioner for the purpose of section 4 read
with section 2(91) of the Act. As noted above,
the power under section 5(3) of the Act is a
general power of sub-delegation vested in the
Commissioner, by the legislature. Once that
power is shown to exist and the same is seen to
have been exercised, no fetters may be searched
and attached to the exercise of that power and no
challenge may arise thereto, de hors the statutory
scheme, to defeat that exercise of power.

27. It is not the requirement of law that the
source of power must necessarily be recited in
the order passed in exercise of that power to
validate the power exercised. It is enough that
the source of power existed and it was exercised
in the manner prescribed by law. Its recital in the
order passed in exercise of that power would not
lend or add to the legitimacy of the power
exercised. It is not a spell that may cause a
magical effect only upon its incantation in a
ritualisticaly correct manner.

28. As to the further submission advanced
by learned counsel for the petitioner on the
strength of section 6 of the Act, we find, the
same is misconceived. It has no applicability to
the present facts. That provision would apply
only to officers appointed under the Central Act.
Those officers may act as "proper officer" under
the Act subject to conditions as the State
Government may notify in that regard, and not
otherwise.

29. Thus, the statutory scheme appears to
be - the legislature has first recognised the
Commissioner as the "proper officer" for all
fuctions under the Act. It also recognises the
classes of officers who may be appointed
officers under the Act. Further, officers of the
UP VAT Act have been recognised as officers
under the Act, on deemed basis. As to the
officers of the Central Government, the State
Government has been delegated the power
(under section 4(1) of the Act) to appoint them
officers under the Act. Second as to the
functions to be performed by various officers
under the Act, the Commissioner may subdelegate absolutely, any functions to an officer
of "State tax" [as defined under section 2(104)
of the Act]. On the contrary, an officer of the
Central Government may not be sub-delegated
such powers generally. He may be sub-delegated
that power and he may act as a "proper officer"
subject
to
the
conditions
as
the
State
Government may by notification (under section
6 of the Act), specify, in that regard.

30. Insofar as the present respondentDeputy Commissioner is an officer under
section 3 of the Act, section 6 of the Act has no
application. Only with respect to officers
appointed under the Central Act, the exercise of
jurisdiction would be circumscribed by a
notification that would have to be first issued by
the State Government, before such jurisdiction
may be created in their favour. Upon clear
language of the provisions of the Act, the
officers appointed under the Act would continue
to be governed by the provisions of sections 3
and 4 read with section 2(91) of the Act and the
424 INDIAN LAW REPORTS ALLAHABAD SERIES
general orders issued by the "Commissioner" in
that regard, issued with reference to the power
exercised under section 5 of the Act.

31. Hence, the decision relied upon by
learned counsel for the petitioner are found to be
wholly distinguishable. In Commissioner of
Customs Vs. Syed Ali and Others (Supra),
two conflicting orders of the Tribunal existed. In
the first set, the Customs, Excise and Gold
(Control) Appellate Tribunal had reasoned, the
Commissioner
of
Customs
(Preventive),
Mumbai was not a "proper officer" under
Section 2(34) of the Customs Act, 1962. In the
second set, a contrary view had been expressed
by the Central Excise and Service Tax Appellate
Tribunal. Both sets of orders of the Tribunal
came to be examined by the Supreme Court in
that decision. Dealing with the same and after
taking notice of the provision of section 28 of
the Customs Act, 1962 (hereinafter referred to as
the Customs Act); the definition of "proper
officer" given under section 2(34) of the
Customs Act and, after taking note of the fact
that the Collector of Customs, (Preventive) had
not been assigned any function under section 28
of the Act it was held, the adjudication order
passed by the Collector Customs (Preventive)
lacked inherent jurisdiction.

32. Relevant to our discussion, in
paragraph nos. 20, 21 and 24 of the report, it was
held as under:-

"20. From a conjoint reading of Sections
2(34) and 28 of the Act, it is manifest that only
such a Customs Officer who has been assigned
the specific functions of assessment and
reassessment of duty in the jurisdictional area
where the import concerned has been affected,
by either the Board or the Commissioner of
Customs, in terms of Section 2(34) of the Act is
competent to issue notice under Section 28 of the
Act. Any other reading of Section 28 would
render the provisions of Section 2(34) of the Act
otiose inasmuch as the test contemplated under
Section 2(34) of the Act is that of specific
conferment of such functions.

21. Moreover, if the Revenue's contention
that once territorial jurisdiction is conferred, the
Collector of Customs (Preventive) becomes a
"proper officer" in terms of Section 28 of the Act
is accepted, it would lead to a situation of utter
chaos and confusion, as much as all officers of
Customs in a particular area be it under the
Collectorate of Customs (Imports) or the
Preventive Collectorate, would be "proper
officer". In our view, therefore, it is only the
officers of Customs, who are assigned the
function of assessment, which of course, would
include
reassessment,
working
under
jurisdictional
Collectorate
within
whose
jurisdiction the bills of entry or baggage
declarations
had
been
filed
and
the
consignments had been cleared for home
consumption, will have the jurisdiction to issue
notice under Section 28 of the Act.

24. Nothing has been brought on record to
show that the Collector of Customs (Preventive),
who had issued the show cause notices was
assigned the functions under Section 28 of the
Act as "proper officer" either by the Board or
the Collector/Commissioner of Customs. We are
convinced that Notifications Nos. 250-Cus. and
251 Cus., both dated 27.8.1983, issued by the
Central Government in exercise of the powers
conferred by sub-section (1) of the Section 4 of
the Act, appointing Collector of Customs
(Preventive), etc. to be the Collector of Customs
for Bombay, Thane and Kolaba Districts in the
State of Maharashtra did not ipso facto confer
jurisdiction on him to exercise power entrusted
to the "proper officers' for the purpose of
Section 28 of the Act."

 (emphasis supplied)

33. Then in Canon India (Supra), a
question arose whether the Additional Director
General, Revenue Intelligence had the authority
to issue a Show Cause Notice under section
11 All. M/S Maa Geeta Traders Vs. Comm. Commercial Tax & Anr.
425
28(4) of the Customs Act, 1962. After taking
note of the provisions of section 28(4) read with
section 2(34) and section 6 of the Customs Act,
1962,
the
Supreme
Court reasoned, the
Additional
Director
General,
Revenue
Intelligence was not a "proper officer". In
reaching that conclusion, the Supreme Court
observed in paragraph nos. 13, 15, 16, 18, 19, 20
and 21 of the report as under:-

"13. Where the statute confers the same
power to perform an act on different officers, as
in this case, the two officers, especially when
they belong to different departments, cannot
exercise their powers in the same case. Where
one officer has exercised his powers of
assessment, the power to order re-assessment
must also be exercised by the same officer or his
successor and not by another officer of another
department though he is designated to be an
officer of the same rank. In our view, this would
result into an anarchical and unruly operation of
a statute which is not contemplated by any
canon of construction of statute.

15. It is obvious that the re-assessment and
recovery of duties i.e. contemplated by Section
28(4) is by the same authority and not by any
superior authority such as Appellate or
Revisional Authority. It is, therefore, clear to us
that the Additional Director General of DRI was
not "the" proper officer to exercise the power
under Section 28(4) and the initiation of the
recovery proceedings in the present case is
without any jurisdiction and liable to be set
aside.

16. At this stage, we must also examine
whether the Additional Director General of the
DRI who issued the recovery notice under
Section 28(4) was even a proper officer. The
Additional Director General can be considered
to be a proper officer only if it is shown that he
was a Customs officer under the Customs Act. In
addition, that he was entrusted with the
functions of the proper officer under Section 6 of
the Customs Act. The Additional Director
General of the DRI can be considered to be a
Customs officer only if he is shown to have been
appointed as Customs officer under the Customs
Act.

18. The next step is to see whether an
Additional Director General of the DRI who has
been appointed as an officer of Customs, under
the notification dated 7.3.2002, has been
entrusted with the functions under Section 28 as
a proper officer under the Customs Act. In
support of the contention that he has been so
entrusted with the functions of a proper officer
under Section 28 of the Customs Act, Shri
Sanjay Jain,
learned Additional
Solicitor
General relied on a Notification No.40/2012
dated 2.5.2012 issued by the Central Board of
Excise and Customs. The notification confers
various functions referred to in Column (3) of
the notification under the Customs Act on
officers referred to in Column (2). The relevant
part of the notification reads as follows:-

"[To be published in the Gazette of India,
Extraordinary, Part II, Section 3 Sub-section
(ii)] Government of India Ministry of Finance
(Department
of
Revenue)
Notification
No.40/2012-Customs (N.T.) New Delhi, dated
the 2nd May, 2012 S.O. (E). - In exercise of the
powers conferred by sub-section (34) of Section
2 of the Customs Act, 1962 (52 of 1962), the
Central Board of Excise and Customs, hereby
assigns the officers and above the rank of
officers mentioned in Column (2) of the Table
below, the functions as the proper officers in
relation to the various sections of the Customs
Act, 1962, given in the corresponding entry in
Column (3) of the said Table: -