GST Investigation Wing issued Instruction No. 3/2022-23 for providing guidelines on issuance of summons under section 70 of CGST Act, 2017
CBIC has noticed a significant trend in officers that summons under section 70 of the Act are issued very casually to anybody in the organization including top officials of the organization even for asking such documents which are readily available on the common portal. In the past various such instances have surfaced. Keeping in view this scenario, the board has decided to bring uniformity in the actions of all officers across the board via issuing guidelines or instructions (both terms used in the official document) dated 17th Aug, 2022.
Moreover, it is also advised to one and all for strict compliance of these instructions. It is also communicated plainly that non-obeisance of these instructions shall be viewed seriously, some disciplinary actions may follow at non-compliance. Also, it is issued to be followed by the field formation, i.e. executing officers who are to implement the law.
Section 70(1) of the Act guides for issuance of summon by proper officer to ANY person whose attendance is considered necessary for gathering any evidence or document or any OTHER THING in an inquiry. This proceeding is similar to as in case of civil court under the provisions of code of civil procedure, 1908. This is also said to be judicial proceeding under the oath.
Instructions go on to direct the field formation that issuing summons should be used judiciously and with due consideration. It is also advised to resort to a letter for requisition of information instead of issuing summons.
Following instructions must be followed relating to investigation matters under GST: –
1. Superintendents may issue summons with prior permission of Deputy/Assistant Commissioner with the reasons for issuance to be recorded in writing.
2. If it is not possible to obtain such prior written permission, oral/telephonic permission must be obtained for issuing Summon.
3. Officer issuing the summon should record in file about appearance/non- appearance of the summoned person and place a copy of the statement recorded in file.
4. Summon should normally indicate the name of offender unless revelation of the name of the offender is detrimental to the cause of investigation so that recipient prima-facie understands as whether he has been summoned as an accused/co-accused/witness.
5. Issuance of summons may be avoided to call upon statutory documents which are digitally/ online available in the GST portal.
6. Senior officials (CMD/MD/CEO/CFO) not to be called at first instance. They should be called when there are clear indications in the investigation of their involvement in the decision-making which led to loss of revenue
7. Generation and quoting of DIN is mandatory vide Circular No 122/41/2019-GST dated 5th Nov, 2019. For format of summon, refer Circular No.128/47/2019-GST dated 23rd Dec, 2019.
The apex court directs UOI/GST Council to issue advisory/instructions to states for generation and quoting of DIN – Pradeep Goyal v. UoI & Ors. [W.P. No. 320 of 2022 dated 18.07.2022]
8. The summoning officer must be present at the time and date for which summons is issued. In case of any exigency, the summoned person must be informed in advance in writing or orally.
9. All persons summoned are bound to appear before the officers concerned except women who do not by tradition appear in public or privileged persons (Pardanashin). The exemption so available to these persons under Section 132 and 133 of CPC, may be kept in consideration while investigating the case.
10. Issuance of repeated summons without ensuring service of the summons must be avoided. Sometimes it may so happen that the summoned person does not join investigations even after being repeatedly summoned. In such cases, after giving reasonable opportunity, generally three summons at reasonable intervals, a complaint should be filed with the jurisdictional magistrate alleging that the accused has committed offence under Sections 172 of Indian Penal Code (absconding to avoid service of summons or other proceedings) and/or 174 of Indian Penal Code (non-attendance in obedience to an order from public servant), as inquiry under Section 70 of CGST Act has been deemed to be a “judicial proceedings” within the meaning of Section 193 and Section 228 of the Indian Penal Code. Before filing such complaints, it must be ensured that summons have adequately been served upon the intended person in accordance with Section 169 of the CGST Act. However, this does not bar to issue further summons to the said person under Section 70 of the Act.
With these instructions, which are apparently made compulsory for CGST officers (if not SGST officers, unless similar instructions are not issued by state authorities), instances of improper issuance of summons for any and every inquiry would be reduced. In the author’s view, adherence to these instructions would re-install the confidence of taxpayers and reduce their worries to be subject to judicial proceedings for any and every matter. Issuance of summons under section 70 also triggers section 84 of the Act for provisional attachment of the property. If these instances are complied then the sword of attachment would also not start hanging on the taxpayer’s head.
Even the judiciary also would not be required to invest their precious time in deciding whether top management is required to present before a proper officer in every inquiry even when they do not know the details about the matter in question.
Considering the constant increase in GST Collection over all these months, it is imperative for the government to make taxpayer friendly policies to reinforce the confidence of trade & industry in the administration. Author suggests that the government should not merely concentrate on increasing the rate of taxes or bringing anything or everything under tax-net to increase revenue, instead they should concentrate on increasing the number of economic transactions on which tax is levied. With this, the golden dream of our worthy Prime Minister, Modi ji, of a 5 Trillion US Dollar economy is easily achievable.
Jai Hind, Jai ICAI
Writing this article on the auspicious day of Shri Krishan Janmashtami, so wishing all bhartiyas, Happy Birthday to Lord Krishna.
Disclaimer: This publication is merely a general guide meant for knowledge purposes only. All the references or content are for educational purposes only and do not constitute a legal advice. We do not accept any liabilities whatsoever for any losses caused directly or indirectly by the use/reliance of any information or conclusion contained in this publication. Prior to acting upon this publication, you’re suggested to seek the advice. This work is entirely in the interest of profession and to contribute into my beloved subject of GST.
Author can be reached at gstrajender@ca-spark.com, His Mobile no. is +91-9891112120
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You are great sir it is excellent sir