2026-VIL-1068-DEL
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SGST High Court Cases

GST - Validity of Circular 31/05/2018-GST as amended - Common Adjudicating Authority for composite SCN - Highest Demand Criterion - Petitioners challenged validity of Circular 31/05/2018-GST as amended by Circular 169/01/2022-GST and 239/33/2024-GST which prescribed manner of determining Common Adjudicating Authority in respect of common SCNs issued to multiple noticees by DGGI - Petitioners contended that Circular conferring jurisdiction based on highest demand criterion was ultra vires and violated Article 14, and that assignment of functions can only be by notification under Section 167 not by Circular under Section 168 of the CGST Act, 2017 - Whether Circular prescribing highest demand criterion as mechanism for selecting Common Adjudicating Authority is valid - HELD - The Circular does not confer or create fresh jurisdiction but merely provides administrative allocation mechanism to select one competent officer from among several already vested with pan-India jurisdiction under Notification 2/2022 issued under Sections 3 and 5(3) of CGST Act - Section 167 is statutory vehicle for conferring jurisdiction by notification while Section 168 is confined to securing uniformity in implementation and cannot override specific mode prescribed under Sections 3, 5(3) and 167. The highest demand criterion is objective, quantifiable and uniformly applicable and bears rational nexus with legitimate object of ensuring single consistent adjudication of what is in substance one cause of action arising from one investigation and avoids possibility of conflicting findings by different officers - No impermissible sub-delegation arises as officer issuing composite SCN exercises no discretion in choosing adjudicating authority but merely applies criterion prescribed by Board - Challenge based on Article 14 fails as criterion is not arbitrary. Petitioners have not shown actual prejudice arising from exercise of jurisdiction by Common Adjudicating Authority nor established denial of proper opportunity of hearing or unfair treatment - The challenge to the jurisdiction of the Common Adjudicating Authority and to the vires of the Impugned Circular fails, such jurisdiction being traceable to Notification No. 2/2017-CT and Notification No. 2/2022-CT, validly issued under Sections 3 and 5(3) of the CGST Act - Remaining grounds including merits of demand and evidentiary issues are left to statutory Appellate Authority – The writ petitions are dismissed
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