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In the absence of any notification for cross-empowerment, taxpayer assigned to State GST Authorities cannot be assessed by Central GST Authorities and vice-a-versa: High Court

High Court decided this important  issue by a common order in a number of petitions filed by various taxpayers.

Issue:

In these Writ Petitions, a common issue arises for consideration as to whether the petitioners who are assigned to either the Central Tax Authorities or the State Tax Authorities under respective CGST Act and/or SGST Act can be subjected to investigation and further proceeding by the counterparts under the respective GST Enactments.

The dispute in these Writ Petitions have arisen on account of the fact that the respective petitioners who have been assigned either to the State Authorities or to the Central Authorities for administrative purposes under the provisions of the respective GST Enactments namely, the CGST Act, SGST Act and IGST Act are/were being subjected proceedings by their counterpart.

Submissions of the petitioners are that in the absence of a proper Notification under Section 6 of the respective GST Enactments for cross-empowerment, the impugned proceedings by the respective counterparts were without jurisdiction.

High Court:

Section 6(1) of the respective GST Enactments empowers Government to issue notification on the recommendation of GST Council for cross-empowerment. However, no notification has been issued except under Section 6(1) of the respective GST Enactments for the purpose of refund although officers from the Central GST and State GST are proper officers under the respective GST Enactments.

Since, no notifications have been issued for cross-empowerment with advise of GST Council, except for the purpose of refund of tax under Chapter-XI of the respective GST Enactments r/w Chapter X of the respective GST Rules, impugned proceedings are to be held without jurisdiction. Consequently, the impugned proceedings are liable to be interfered in these writ petitions.

Thus, if an assessee has been assigned administratively with the Central Authorities, pursuant to the decision taken by the GST Council as notified by Circular No.01/2017 bearing Reference F.No.166/Cross Empowerment/GSTC/2017 dated 20.09.2017, the State Authorities have no jurisdiction to interfere with the assessment proceedings in absence of a corresponding Notification under Section 6 of the respective GST Enactments.

Similarly, if an assessee has been assigned to the State Authorities, pursuant to the decision taken by the GST Council as notified by Circular No.01/2017 bearing Reference F.No.166/Cross Empowerment/GSTC/2017 dated 20.09.2017, the officers of the Central GST cannot interfere although they may have such intelligence regarding the alleged violation of the Acts and Rules by an assessee.

The manner in which the provisions have been designed are to ensure that there is no cross interference by the counterparts.

Only exception provided is under Section 6 of the respective GST enactement. Therefore, in absence of a notification for cross-empowerment, the action taken by the respondents are without jurisdiction. Officers under the State or Central Tax Administration as the case may be cannot usurp the power of investigation or adjudication of an assesse who is not assigned to them.

Therefore, the proceedings initiated by the respondents so far against the respective petitioners by the Authorities other than the Authority to whom they have been assigned to are to be held as wi.......
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Author:

TaxReply


Apr 19, 2024

Comments


Excellent Ruling..
By: Govind Agrawal
Apr 21, 2024


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