GOVERNMENT OF INDIA
MINISTRY OF FINANCE / DEPARTMENT OF REVENUE
CENTRAL BOARD OF EXCISE & CUSTOMS
NORTH BLOCK, NEW DELHI-110001
Tele : +91-11-23094828 Fax : +91-11-23092512
D.O. F.No. CBEC/20/43/01/2017-GST (Pt.)
Dated: 5th October, 2018
It has been brought to the notice of the Board that there is ambiguity regarding initiation of enforcement action by the Central tax officers in case of taxpayer assigned to the State tax authority and vice versa.
2. In this regard, GST Council in its 9th 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 reads as follows:-
“viii. Both the Central and State tax administrations shall have the power to take intelligence-based enforcement action in respect of the entire value chain”
3. It is accordingly 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 SCN, adjudication, recovery, filing of appeal etc. arising out of such action.
4. 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 conclusions.
5. 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.
6. It is also informed that GSTN is already making changes in the IT system in this regard.
With best Wishes,
All Principal Chief Commissioners/ Chief Commissioners of Central Tax/ Principal Directors General/ Directors General