In a recent decision, the New Delhi High Court upheld the validity of summons issued under Section 70 of the CGST Act, which were based on a CBIC Circular No. 3/3/2017 dated 05.07.2017. The case involved Lovelessh Singhal, proprietor of M/s Shivani Overseas, who received a GST summons during an inquiry related to M/s Midas Marketing Inc. The summons, which requested documents and a voluntary statement, was challenged by Singhal on the grounds that the CBIC lacked the legal authority to assign "proper officer" functions and that the summons date had expired by the time it was served.
The primary issue was whether the CBIC Circular and the resulting summons were issued without legal authority. The Court emphasized the presumption of validity for administrative circulars, placing the burden of proving illegality on the petitioner. It noted that the Commissioner, being part of the Board, likely followed statutory approval processes under Section 168.
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The petitioner was unable to demonstrate that the circular lacked authority or approval. Consequently, the Court upheld both the circular and the summons, while rescheduling the appearance date to ensure fairness. This decision reinforces the legal standing of administrative circulars and the powers assigned to GST officers under such directives.
Parties : LOVELESH SINGHAL Vs CENTRAL BORAD OF INDIRECT TAXES & CUSTOMS, COMMISSIONER OF THE CENTRAL TAXES AND SUPERINTENDENT/ APPRAISER/ SENIOR INTELLIGENCE OFFICER
Order Date - 02 February 2026
Facts -
- Lovelessh Singhal, proprietor of M/s Shivani Overseas, received a GST summons during an inquiry related to another entity, M/s Midas Marketing Inc., seeking documents and a voluntary statement.
- The summons was issued under Section 70 of the CGST Act by a GST intelligence officer relying on CBIC Circular No. 3/3/2017 dated 05.07.2017.
- The petitioner challenged both the circular and the summons, arguing that the CBIC had no legal authority to assign “proper officer” functions.
- He also pointed out that the summons date had already passed by the time it was served on him.
Issue -
- Whether the CBIC Circular assigning powers to GST officers and the consequent summons issued under Section 70 were without legal authority?
Order -
- The Court held that there is a strong presumption of validity in favour of administrative circulars and the burden to prove illegality lies on the petitioner.
- It observed that the Commissioner is part of the Board, and issuance of the circular was presumed to have followed statutory approval under Section 168.
- The petitioner failed to prove that the circular was issued without authority or approval.
- While upholding the circular and summons, the Court rescheduled the appearance date to ensure fairness.
