GST

All about summons under GST

Summons under GST

Under GST law, GST officers can issue summons to any taxpayer requiring their attendance. There has been numerous cases wherein tax authorities issued summons to various companies, employees and key managerial persons and they had to appear before GST officers. When summons is issued under GST, the one to whom such summons have been issued are duty bound to appear before the GST officers. However, taxpayers get intimidated on receiving summons as they are unaware of how to deal with such summons. They are oblivious of their rights and duties. In view of that, this article seeks to apprise its readers about their rights and duties with respect to summons under GST but before we delve into this subject let’s understand the meaning of Summons under GST.

What is Summons under GST?

A Summon refers to an order of the court or any administrative body of the government to any person to appear in court or in the concerned office in person at a specified place and time regarding any investigation or enquiry on any matter. As per the GST law, section 70 of the CGST Act, 2017 empowers GST officers to issue summon to any person to appear before them, if it is necessary in the course of an inquiry to record statements or produce some documents. In case of failure to appear before the concerned officer, penalty can be imposed.

Who can issue summons under GST?

If you have received a summon under GST, then you should find out who has issued such summon. Find out whether summon has been issued by a proper officer under GST law or not. The officers of the audit wing cannot issue summons under GST however, the DGGI has been bestowed with vast powers in all of India to exercise this power. DGGI refers to Directorate General of GST Intelligence. It is the topmost intelligence and investigative agency which deals in matters relating to violation of the Goods & Services Tax, Central Excise Duty and Service Tax.

What happens when one fails to appear after a summons?

Summons proceedings are equivalent to judicial proceedings, so if a person does the following, he shall be liable to be prosecuted under various sections of the Indian Penal Code:

  1. Fails to appear on the summons date without any reasonable justification
  2. Provides false evidence
  3. Found to be absconding to avoid the services of summons
  4. Fails to produce the electronic records or documents required
  5. Fails to appear after repeated summons
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In addition to prosecution, a monetary penalty is also imposed on the person under section 122 (3) (d) of the CGST Act for failure to appear after the issuance of the summons or for failure to provide documentary evidence despite the issue of summons. The penalty shall amount to INR 25,000. Further, any person’s refusal to record any statement before the officer leads to the summoning officer informing his superior office about the same and such cases are also brought to the notice of the Magistrate.

What are the details that have to be presented in the GST Summons?

The following details have to be presented in the GST summons:

  1. Document Identification Number (DIN) must be generated and quoted on the GST Summons for investigation purposes. The summons is considered invalid if the DIN is absent from the GST Summons.
  2. The language used in the summons should be simple and civil and not something that borders on harassment of the taxpayer.
  3. The summons should be in a manner that justifies the reasons for its issuance.

The prescribed format of the summons in the image below should be followed

Instructions and Circulars on the issue of summons

The CBIC issued circular No. 122/41/2019-GST dated 5th November 2019, giving instructions regarding the issue of summons. The instructions are as follows:

  1. Superintendents may issue summons only after obtaining approval from the officer through prior written permission. In this case, the officer should not be allowed to be below the Deputy or Assistant Commissioner rank.
  2. Where no prior written permission can be obtained, telephonic or oral permission may be obtained and then converted into written forms. The same must be intimated to the officer without fail and at the earliest.
  3. The GST officer who has issued summons regarding the appearance or non-appearance of the summons recipient. The file must be maintained as a part of the records. In addition to this, a copy of the statement must be placed in the records.
  4. The summons issued must include the name of the offender/offenders so that the recipient can decipher what capacity he is being summoned, whether as an accused, co-accused or in the capacity of a witness. However, the name may be excluded if it could detrimentally affect the investigation process.

Taxpayer’s rights and duties

Taxpayers should know their rights and duties in case they receive a GST summons. The awareness protects against unwanted actions from officials of the GST office. The CBIC issued rules focusing on regulating summons proceedings, stating that summons will be issued only when the taxpayer is not cooperative. Further, a summons is issued against the senior management and should warrant the appearance during reasonable hours, such as regular business hours.

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A taxpayer has the following rights:

  1. Right of retraction: Sometimes a taxpayer gets intimidated and pressurised by the GST officers, which leads to submitting inaccurate information. In such situations, the taxpayer has the right to retract the inaccurate information and submit the accurate version as a fresh statement.
  2. Right to remain silent: The right to remain silent is a constitutional right which extends to these cases as well. If a taxpayer is uncertain about the answers to a particular question framed before him, he is well within his rights to choose to remain silent.
  3. Right to cross-examine: The GST officers1 may manipulate the taxpayer summoned by providing reference to adverse statements submitted by various third parties. The taxpayer has the right to cross-examine the third party about the validity of the statement.
  4. Right to refer to books of accounts and other documents: The taxpayer has the right to refer to the books of accounts and other documents required to refer to provide an accurate statement that goes on the record. The taxpayer has to provide information to the best of his ability and knowledge to the GST Officers. No misleading and incorrect statements shall be accepted. The taxpayer must be aware of the ramifications of the submissions made to the GST officers. The Supreme Court has held that any statement made before the GST officer is admissible as evidence in a court of law. Since GST officers are not classified as police officers, any statement before them constitutes evidence.

A taxpayer has the following Duties

  1. Bound to honour and appear: The taxpayer must not ignore the summons and should duly appear before the authority or the concerned officer. The taxpayer must follow the necessary guidelines envisaged in the summons, which have all the information regarding the venue, date of appearance, cause, material information, default by the company or individual and etc.
  2. Submit Documents: The directions of the authorities should be followed by the taxpayers when required to submit any document. The taxpayer has to be conscious when providing necessary documents as the proceedings of summons and investigations under GST are similar to the procedure under the general prevailing law of the country followed in courts of law. The taxpayer must furnish the relevant documents before the authorities in case of default on their part under GST.
  3. Furnish Relevant Information: Taxpayers must provide GST officers with true and correct answers to questions raised. All necessary information to the taxpayer’s knowledge must be provided. No false statement must be furnished before the authority as it may attract an offence under the Indian Penal Code, 1860, for which they can be tried. Providing accurate information to the tax officers will safeguard the taxpayers from any default or eventualities.
  4. Do not conceal material information: The taxpayer must not conceal any material information from the GST officials. The information which has serious nature and can affect the direction of the investigation must be put forth.
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Conclusion

In summation, a summons is a procedure where an officer calls upon the appearance or presence of a taxpayer or assessee. An inquiry begins with a summons, and the detailed procedure has been laid down under section 70 of the CGST Act. Further, the CBIC has also provided guidelines on it.

FAQs

  1. Can the GST superintendent issue a summons?

    Yes, the GST superintendent can issue summons.

  2. Who can issue summons in GST?

    The power to issue summons is generally exercised by the Superintendent, even though higher officers may also issue summons.

  3. What is the mode of service of summons under GST?

    Usually, a summons proceeding is issued in writing but can also be issued electronically.

  4. Can summons be attended by Authorized Representative?

    No, summons under GST law require the personal presence of the person summoned, and an Authorized Representative cannot attend on his behalf.

  5. What is the offence under Section 132 of the GST?

    Section 132 provides for an offence of fraudulent availment of the input tax credit, issuance of invoices without a supply of goods or services and tax evasion.

  6. What is the punishment for Section 132?

    The punishment for an offence under section 132 can range from imprisonment to cancellation of registration.

  7. What is Section 74 of the CGST Act?

    Section 74 prescribes that a proper officer may issue a notice to any person who he has the reason to believe has evaded taxes or not paid tax due and determine the tax and interest payable and issue a demand notice for the same.

  8. What is the time limit for a refund under section 77 of the CGST Act?

    The time limit for a refund under section 77 of the CGST Act is two years.

References

  1. https://cbic-gst.gov.in/cgst-nodal-officer.html

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