The Gujarat High Court, in M/s Jai Ganesh Enterprise v. Union of India & Others, examined whether officers appointed under the Gujarat Goods and Services Tax Act, 2017 could exercise powers under the Integrated Goods and Services Tax Act, 2017 without a separate cross-empowerment notification issued by the Central Government.
The judgment was delivered on 13 July 2026 by a Division Bench comprising Justice A.S. Supehia and Justice Vaibhavi D. Nanavati in R/Special Civil Application No. 9269 of 2026. The petitioner had challenged a confiscation order issued in Form GST MOV-11 and the consequential summary order issued in Form GST DRC-07.
Background of the Dispute
The petitioner, a registered GST dealer and purchaser of pan masala and tobacco, challenged the confiscation proceedings initiated in relation to an inter-State movement of goods. The consignment was intercepted on 25 February 2026. According to the petitioner, the driver produced the relevant e-invoices and e-way bills at the time of interception.
Physical verification was subsequently conducted, and no discrepancy was found between the quantity recorded in the invoices and the quantity of goods physically verified. However, the goods were detained on the allegation that the accompanying documents had already been used for an earlier movement between 22 February and 23 February 2026.
A show-cause notice in Form GST MOV-10 was thereafter issued under Section 130 of the CGST Act read with Section 20 of the IGST Act. Following the petitioner’s reply, the proper officer passed the confiscation order and confirmed an aggregate demand of ₹88,68,728 towards penalty and redemption fine concerning the goods and conveyance.
Challenge to Cross-Empowerment
The principal contention of the petitioner was that Section 4 of the IGST Act required the Central Government to issue a specific notification before officers appointed under a State GST law could function as proper officers under the IGST Act.
The petitioner argued that although the Commissioner of State Tax, Gujarat had issued an order dated 23 June 2017 identifying proper officers under the Gujarat GST Act, that order could not, by itself, authorise State officers to exercise jurisdiction under the IGST Act.
It was further contended that the statutory appeal mechanism did not expressly provide for an appeal against an order passed under the IGST Act. On that basis, the petitioner claimed that no effective alternative remedy was available.
Gujarat High Court’s Interpretation of Section 4 of the IGST Act
The High Court rejected the petitioner’s interpretation of Section 4 of the IGST Act. It held that the provision itself authorises officers appointed under the State GST Act or the Union Territory GST Act to function as proper officers for the purposes of the IGST Act.
According to the Court, the words used in Section 4 confer the authorisation directly. A notification is required only where the Central Government, acting on the recommendations of the GST Council, seeks to prescribe specific exceptions or conditions governing such authorisation.
The Court clarified that Section 4 does not mandate the issuance of a separate notification for the initial or general cross-empowerment of State GST officers. The absence of such a notification, therefore, does not render their actions under the IGST Act without jurisdiction.
The Gujarat High Court also relied upon decisions of the Punjab and Haryana High Court, Calcutta High Court and Madhya Pradesh High Court, which had adopted a similar interpretation of Section 4 of the IGST Act.
The Court noted that the Commissioner of State Tax, Gujarat had already issued an order dated 23 June 2017 specifying the officers competent to perform functions under various provisions of the Gujarat GST Act. When read with Sections 4 and 20 of the IGST Act, such officers were competent to exercise corresponding powers in relation to inter-State supplies.
Statutory Appeal Under the Gujarat GST Act
The High Court also rejected the petitioner’s contention that no statutory appeal was available against the confiscation order.
It held that where an order under the IGST framework is passed by a proper officer appointed under the State GST law, the appeal lies before the State appellate authority under Section 107 of the Gujarat GST Act.
The Court explained that Section 6(3) of the Gujarat GST Act merely prevents proceedings relating to an order passed by a State officer from being placed before an officer appointed under the Central GST Act. It does not eliminate the taxpayer’s appellate remedy before the competent State appellate authority.
Accordingly, the petitioner was required to challenge the confiscation and demand orders through the statutory appellate mechanism rather than by invoking the writ jurisdiction of the High Court.
Decision of the High Court
The Gujarat High Court held that no further notification was required from the Central Government to authorise State GST officers to act as proper officers under the IGST Act. Section 4 of the IGST Act itself provides the necessary statutory cross-empowerment, subject only to such exceptions and conditions as may be notified.
Since the petitioner had an effective alternative remedy of appeal under Section 107 of the Gujarat GST Act, the High Court declined to entertain the writ petition and dismissed it.
Significance of the Judgment
The judgment provides important clarity on the jurisdiction of State GST officers in matters involving inter-State movement of goods. It confirms that Section 4 of the IGST Act operates as a direct statutory authorisation and that a separate cross-empowerment notification is not a prerequisite for every exercise of jurisdiction.
The ruling is particularly relevant for proceedings involving inspection, detention, confiscation and penalties under Sections 129 and 130 of the GST laws. It also clarifies that orders passed by State GST officers in the exercise of IGST-related powers remain appealable before the State appellate authority.
The decision will be useful for advocates, Chartered Accountants, GST practitioners, tax consultants, corporate tax teams and businesses dealing with jurisdictional objections, inter-State goods movement, confiscation proceedings and appellate remedies under the GST framework.