GST

GST intelligence­ enforcement action power. Both Central or State officers can take action – CBIC

GST intelligence­ enforcement action power-Both Central or State officers can take enforcement action in respect of the entire value chain

Central Board Of Excise & Customs (CBIC) has issued a clarification regarding ambiguity regarding initiation of enforcement action by the Central tax officers in case of taxpayer assigned to the State tax authority and v1ce versa.

It has been informed that GST Council in its 91h meeting held on 16.01.2017 had discussed and made recommendations regarding administrative division of taxpayers and concomitant issues. The recommendation in relation to cross-empowerment of both tax authorities for enforcement of intelligence based action is recorded at para 28 of Agenda note no. 3 in the minutes of the meeting which read s as follows:-

“viii. Both the Central and State tax administrations shall have the power to take intelligence­ baseenforcement action in respect of the entire value chain

Accordingly it has been clarified that the officers of both Central tax and State tax are authorized to initiate intelligence based enforcement action on the entire taxpayer’s base irrespective of the administrative assignment of the taxpayer to any authority.

The authority which initiates such action is empowered to complete the entire process of investigation, issuance of Show Cause Notice (SCN), adjudication, recovery, filing of appeal etc. arising out of such action.

In other words, if an officer of the Central tax authority initiates intelligence based enforcement action against a taxpayer administratively assigned to State tax authority, the officers of Central tax authority would not transfer the said case to its State tax counterpart and would themselves take the case to its logical conclusion.

Similar position would remain in case of intelligence based enforcement action initiated by officers of State tax authorities against a taxpayer administratively assigned to the Central tax Authority.

It has been further clarified that GSTN is already making changes in the IT system in this regard.

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