New GST Circular Streamlines Enforcement — Proper Officers Notified for Fresh Demand & Penalty Provisions

CBIC Issues Circular No. 254/11/2025-GST (Dated 27 October 2025)

Subject: Assignment of proper officers under new and existing provisions of CGST Act.

Summary:
The Central Board of Indirect Taxes and Customs (CBIC) has released this important circular to assign proper officers under the following provisions of the CGST Act, 2017:

Section 74A – Determination of tax not paid or short paid, or ITC wrongly availed/utilised for any reason for FY 2024–25 onwards.
Section 75(2) – Where an appellate or revisional authority revises an order and directs a fresh determination of tax.
Section 122 – Offences and penalties under the CGST Act.

This major step fills the gap noted in earlier circulars (No. 1/1/2017-GST, No. 3/3/2017-GST, and No. 31/05/2018-GST) that had not designated officers for these specific sections.

Impact:
This ensures administrative clarity for new enforcement provisions, especially Section 74A, which becomes operative from FY 2024–25 onwards.

New Section 74A Introduced (effective FY 2024–25)

Section 74A deals with determination of tax not paid or short paid, erroneously refunded, or ITC wrongly availed or utilised for any reason for financial years 2024–25 and onward.
It parallels Section 74, but applies prospectively with a modified framework for adjudication, promoting more structured and time-bound proceedings.

Re-emphasis on Proper Officer Assignment

The CBIC reiterates that:

Assistant Commissioners / Deputy Commissioners / Superintendents of Central Tax will be the designated proper officers for initiating and concluding proceedings under the mentioned sections.
This provides legal backing for demand, recovery, and penalty proceedings under Section 74A, Section 75(2), and Section 122.

Key Administrative Implication

Proper officer assignment is essential for validity of proceedings under the CGST Act. Without such assignment, any notice or order could be challenged as being without jurisdiction.
Hence, this circular strengthens the enforceability of future proceedings.

Compliance Note for Taxpayer

Businesses should ensure:

Any notice or communication relating to Sections 74A / 75(2) / 122 is issued by a properly assigned officer per Circular No. 254/11/2025-GST.
Records and ITC claims for FY 2024–25 onwards are meticulously maintained, as Section 74A enables review even for procedural or interpretational differences.

Summary Takeaway
The CBIC’s latest circular marks a major administrative update by operationalising new enforcement provisions under the GST law. It establishes jurisdictional clarity and officer responsibility, thereby ensuring that the upcoming Section 74A regime runs smoothly.