Avanti Feeds Limited v. Deputy Commissioner of State tax and Union of India

GST update /2026-27/0006

GST UPDATE

Writ Petition No.: 11760/2023

Court: HIGH COURT OF ANDHRA PRADESH AT AMARAVATI

Case Title: Avanti Feeds Limited v. Deputy Commissioner of State tax and Union of India

Outcome: Writ Petition was allowed

Judgement Date: 01.04.2026

BRIEF FACTS OF THE CASE:

M/s Avanti Feeds Ltd.,a registered entity under CGST Act, is engaged in the business of manufacturing and supplying aquatic feed. For the purposes of manufacturing the said aquatic feed, petitioner imports certain inputs such as fish meal, soya, algal oil. The petitioner had claimed exemption from payment of IGST in relation to import of these inputs during the period A.Y. 2017-18 to 2022-23. The Avanti feeds ltd. jurisdiction was assigned to Central Jurisdiction. On 11.11.2022, the Deputy Commissioner of State Tax conducted an inspection under the authorisation of Joint Commissioner, thereafter, an intimation of tax payable as ascertained was issued on 19.12.2022 under Section. 73(5) of the CGST Act, read with Rule 142(1A) in which it was mentioned that some of the exemptions claimed in respect of classification of goods was not correct and sought an explanation on the same. The petitioner gave a reply against the same dated 12.01.2023 which was followed by another intimation dated 10.04.2023 in the form of Show cause notice (SCN). Assessee challenged the SCN and circular no. 80/54/2018-GST dated 31.12.2018 which denied the benefit of exemption given by the Central Government under an Exemption Notification issued under Section 6(1) of IGST Act. Aggrieved, the petitioner approached the High Court.

QUESTION BEFORE HON’BLE COURT:

• Whether GST authorities have jurisdiction to assess and recover IGST on imported goods?

• Whether cross-empowerment under Section 6 permits State officers to act in cases assigned to Central authorities?

• Whether Circular No. 80/54/2018-GST could be relied upon when already struck down by another High Court?

• Whether issuance of a consolidated notice covering multiple years is permissible?

Brief Arguments by Petitioner (Registered Person):

Petitioner submitted following contentions: -

• Cross Empowerment between IGST and SGST officers not permissible:

Learned Legal Counsel of petitioner contended that petitioner has been allocated to the Central Jurisdiction. As such no State GST authority can initiate any proceedings against the petitioner. The IGST act does not gives power to state officials to initiate, continue or complete any proceedings under IGST act.

• Section 2(3) and Section 28 of Customs Act:

Further, it was contended that Section 2(3) and Section 28 of Customs Act, 1962 read with proviso to Section 5(1) of IGST act makes it clear that the jurisdiction to assess the IGST payable, in the course of import of goods, into India, vests solely with the Customs Officials and no authority under any of the GST acts can undertake such an exercise.

• Circular no. 80/54/2018-GST ultra vires the GST Exemption notification:

Petitioner contended that the circular no. 80/54/2018-GST restricting the exemption benefits cannot be relied upon as the said circular had already been set aside by the judgement dated 05.10.2021 given by Hon’ble High Court of Madras in Jenefa India v. Union of India (W.P(MP) 16770 to 16776 of 2019).

• Various issues which had not been raised in the previous intimation have been raised in the new intimation:

Petitioner contended that various issues which had not been raised in the intimation dated 19.12.2022 have been raised in the fresh intimation dated 10.04.2023. which is not permissible under law.

Therefore, the impugned notice is liable to be set aside

Brief Arguments by Revenue Department:

Revenue Department contended that:

• Writ is not maintainable as there is alternate remedy available:

Revenue department contended that writ is not sustainable as it is filed directly against the SCN and the alternate remedy available to the petitioner was not exhausted.

• Cross empowerment available:

Revenue by giving reference to Section 6 of the APGST act contended that the officers are authorized to issue any orders or proceedings under the CGST act and such cross empowerment has been discussed by the GST council in its 9th meeting on 16.01.2017 wherein it was decided that no separate notification is required for authorities under the State GST acts to exercise powers conferred on Central Tax officers.

• Action is not a parallel proceeding:

The Revenue argued that Section 6 of the APGST Act allows cross-empowerment. In support, reliance was placed on an office memorandum dated 30.06.2017 issued by the GST Council, which clarified that officers under one GST law can take action under the other GST laws as well. The Department also referred to the Allahabad High Court decision in Shree Maa Trading Company to support this view. Further, it was contended that there was no question of parallel proceedings since the State GST authorities had initiated action on 12.12.2022, much before the Customs authorities, who started proceedings only on 08.08.2025. Hence, according to the Department, the proceedings were valid and not overlapping.

Findings & Judgement:

Following are the findings of the Hon’ble SC in the instant case:

• Maintainability of Writ Petition:

Hon’ble Court discussed that in normal course, writ petition is not entertained at the stage of SCN unless it is demonstrated that SCN is wholly without jurisdiction as held in the landmark judgment given by Hon’ble SC in case of Whirlpool Corporation v. Registrar of Trade Marks, Mumbai and Ors. Accordingly, the Court proceeded to examine whether the impugned notice was issued by a competent authority.

• Jurisdiction over IGST on Imports lies exclusively with Custom Authorities

The Court held that IGST on imported goods is governed by the proviso to Section 5(1) of the IGST Act, which clearly provides that such tax shall be levied and collected in accordance with the Customs Tariff Act and the Customs Act. It was further noted that the definition of “assessment” under the Customs Act includes determination of all duties, taxes, and exemptions relating to imported goods. Therefore, authority who can levy and collect integrated tax, on goods being imported into India, for supply of such goods can only be the customs officers under the Customs Act and not with GST officers. The court further clarified that the GST authorities continue to have jurisdiction in respect of inter-State and domestic transactions within India.

• State Officer to be given jurisdiction only if the taxpayer has been allotted administratively:

As per Section 6 and Section 4, empowerment of an officer under the APGST Act to enact under the CGST and IGST Acts exists only if the registered person has been allotted administratively, to the state of Andhra Pradesh and such officer is the proper officer for such tax payer. In the present case, petitioner has been administratively allotted to the Central Government. Therefore, the respondent cannot claim the benefit of cross empowerment, under Section 4 of the IGST act, to assume jurisdiction.

• Circular already struck down by Madras High Court:

Hon’ble Court further held that circular no. 80/54/2018-GST dated 31.12.2018 had already struck down by Hon’ble Madras HC. Therefore reliance was placed on decision given by Hon’ble SC held in the case of Kusum Ingots and Alloys Ltd. v. Union of India and ors., a circular, notification, or legislation which has been struck down by any HC, would effectively result in the said legislation becoming inoperative across India. Therefore, there is no need to struck down the circular again. Therefore, restricting the exemption benefits based on the struck downed Circular was invalid.

Single Show Cause Notice issued for Multiple Years

• The Court held that the impugned notice was also invalid as it covered multiple financial years in a single show cause notice. Such consolidated notices are not permissible in law, as held in S.J Constructions vs Assistant Commissioner. Accordingly, the notice was liable to be set aside on this ground as well.

Accordingly, the writ petition was allowed, and the notice was set aside.

Various Sections referred in the instant GST update

Sec. 73(5) of CGST Act, 2017

Sec. 5, Sec.6 of SGST Act, 2017

Sec. 6(1), Sec. 5, Sec. 7, of IGST Act, 2017

Sec. 2(3), Sec. 3, Sec. 12, Sec. 28 of Customs Act, 1962

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