State GST Officers Automatically Authorized As “Proper Officers” U/S 4 IGST Act; Separate Central Notification Not Mandatory: Gujarat High Court
The Bench noted that the legislative architecture of Section 4 creates a self-executing framework of cross-empowerment that can only be restricted, not initiated, by a specific notification.
The Gujarat High Court has held that Section 4 of the Integrated Goods and Services Tax Act, 2017 inherently empowers State GST officers to act as proper officers under the IGST Act, and that no separate Central Government notification is required for such cross-empowerment. It held that actions taken by State authorities in relation to inter-state transactions are valid unless the GST Council prescribes any limitation.
The Court further held that an alternative remedy under Section 107 of the Gujarat Goods and Services Tax Act, 2017 is available, clarifying that, read with Sections 4 and 20 of the IGST Act, orders passed by State proper officers are appealable before the designated State appellate authority.
A Division Bench comprising Justice A.S. Supehia and Justice Vaibhavi D. Nanavati observed, “A careful reading of the provision of section 4 of the IGST Act, manifests that the officers appointed under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act’“are authorized to be the proper officers’ for the purpose of this Act i.e. the IGST Act, subject to such exceptions and conditions as the Government shall, on the recommendations of the Council, by notification, specify…”.
“…no further notification is required to be issued by the Central government clarifying the exercise of powers by proper officers under IGST, since the Section 4 of the IGST Act already takes care of the state of affairs...”, the Bench noted further.
Advocate Samir Gupta appeared for the petitioner and Tanushree Shrimal, Assistant Government Pleader appeared for the respondents.
The petitioner, M/s Jai Ganesh Enterprise, a registered dealer under the GST regime, engaged in the purchase of Pan Masala and Tobacco from M/s Ram Trading Company. While the consignment was in transit, it was intercepted by State Tax authorities on February 25, 2026, and the driver’s statement was recorded.
Although a subsequent physical verification yielded no discrepancies regarding the physical quantity of the goods versus the accompanying e-invoices and e-way bills, the proper officer issued a detention order on the ground that the accompanying transit documents had been previously utilized on an earlier occasion.
Following the detention order, the state revenue authorities issued a show-cause notice for confiscation under Section 130 of the Central Goods and Services Tax Act, 2017 read with Section 20 of the Integrated Goods and Services Tax Act, 2017.
The petitioner submitted their reply contesting the valuation and penalties; however, the respondent authority proceeded to pass a final confiscation order under Form GST MOV-11 on March 27, 2026, confirming an aggregate demand of ₹88,68,728/- in lieu of the confiscation of the goods and conveyance. This was subsequently followed by a summary order in Form GST DRC-07 on April 24, 2026, which prompted the petitioner to approach the High Court under Article 226.
The Bench remarked that notifications are only mandated if the Central Government, on the recommendations of the GST Council, intends to curtail or introduce specific exceptions to this overarching power.
Additionally, the Court resolved the appellate ambiguity by stating that since the initial orders were passed by State officials, the statutory bar under Section 6(3) of the Gujarat Goods and Services Tax Act merely restricts appeals before Central authorities, thereby affirming that the proper channel for statutory redressal remains the State appellate forum.
“…the language of provision of section 4 of the IGST Act indubitably prescribes that the officers who are appointed under the State Goods and Services Tax Act are authorized and empowered to carry out their powers or functions for the purpose of IGST Act. The section does not in any manner further mandates of issuance of notification by the Central Government suggesting or stipulating any division of powers by such proper officers but, it is left on the discretion of the proper officer, who is appointed by the State Government to further delegate the powers to other officers…”, it noted further.
The Court found no jurisdictional defect or structural error in the initiation of the confiscation proceedings by the State officers. Declining to exercise its extraordinary writ jurisdiction due to the availability of an alternative statutory remedy, the Court dismissed the Special Civil Application, leaving it open to the petitioner to approach the appropriate appellate authority under Section 107 of the Gujarat Goods and Services Tax Act, 2017.
Cause Title: M/s Jai Ganesh Enterprise v. Union of India & Ors. (Neutral Citation: 2026:GUJHC:44995-DB)
Appearances:
Petitioner: Samir Gupta, Nachiket D. Mehta, Advocates.
Respondents: Tanushree Shrimal, Assistant Government Pleader, Ankit Shah, Advocate.