Point of Law : Though appointed (clearly with reference to section 4 of the Act, no function came to be entrusted to them under the Customs Act, in absence of any sub-delegation made in their favour by a further notification under section 6 of that Act.

JUDGMENT :

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, Sector-I, 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 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