Economic Cell of Bharatiya Janata Party, Rajasthan has made a representation to Smt. Nirmala Sitharaman, Minister of Finance and Corporate Affairs on 21/05/2022 against Beyond law use of power by GST officer to diffuse the objective of make in India and ease of doing business by creating tax terrorism. Relevant Text of the representation is as follows:-

Date: 21/05/2022

To,
Smt. Nirmala Sitharaman
Minister of Finance and Corporate Affairs
Government of India

Through,

Shri Satish Poonia
State President Rajasthan
Bhartiya Janta Party.

Sub: Beyond law use of power by GST officer to diffuse the objective of make in India and ease of doing business by creating tax terrorism.

Respected Madam,

Greetings..!!

In reference to above mentioned subject, we wish to draw your attention on the following issues of serious concern where the officers of the GST use their power which was even not provided in the law to meet their personal objective with the motto of tax terrorism which diffuse the objective of make in India and ease of doing business which was as pronounced by the Hon. Prime Minister of India

Some of the key area where the trade and industry were facing the tax terrorism due to lack of accountability on the officers,

1. Tax terrorism in GST registration

The GST registration was rejected even if the prescribed procedure as define in the rule was followed and the said application which was rejected earlier now approved which was filed with the same set of the document and same process, if the concern person meet with the officer and fulfill his personal wish (Note:- the    system will forward the second application to the same officer automatically) Mapping of Principal place of business which does not matches with the exact address.

Further the powers were misused because there is no accountability on the officer and there is no fix SOP for the registration.

Some of the Example of Reasons for Cancellation of Registration mentioned are:‑

a) Office closed (even though the visit was done not in office hours)

b) Source of Income, 10 years income tax return

c) Chain of documents of title of ownership of property even though Registry Copy submitted, etc.

We would also request that the person who had issued the show cause notice will not adjudicate the case.

2. Rejection of Refund Application

The refund was processed by the proper jurisdictional Officer due to which he has always a liberty to create tax terrorism with the objective to defame the objective of make in India as pronounced by the Hon. Prime Minister, the refund application which was filled with all set of documents were not processed within the time period as prescribed under law i.e. 60 days and some of the persons who meet with the officer and satisfied his personal needs, the application filled later was processed first, in simple word we can say the FIFO method for disposing the application as suggested by the GOl was neglected and never been followed, in some of the cases if refund application was approved then a payment order for the same was not done because of their personal wants for creating tax terrorism and beyond the law show cause notice were issued to reject the same, therefore we request GO1 to take cognizance on the same.

Further in many cases, refund to exporters are being stopped from last more than 2 years without mentioning any written reason for the same and just saying verbally that you are tagged as Risky Exporter. No responses to documents and information submitted for the same given to registered tax payers.

3. Investigation in GST – A Tool Of Harassment:‑

Issue of Summons in contradiction of guidelines of CBIC & legal provisions, e.g.:

a. Recording of statements first, thereafter issue of summons for formality;

b. Issue of Summons to give statement in virtually no time;

c. Taking taxpayer forcefully to department for statements and then issue of summons for on spot statements;

d. Most common: officers not available at the time of given summons and ask to come on some other day for recording the statements;

e. Wasting crucial time of tax payers by asking them to wait for many hours even though the registered person reaches office of proper officer at the given date and

f. Just to create pressure, direct issue of summon to top management, despite knowing that top management may not be aware of anything in relation in GST

g. Not providing the detail of "Reason to believe' on record on the basis of which permission for Inspection, search has been received.

h. Investigation not getting close and pending for more than 2 years. NO SCN being issued for long period. Focus is to make forceful recovery.

4, Forceful Recovery without adjudication;

Due to non-availability of specified guidelines, the officers very openly or frequently use the summons for creating tax terrorism as in a summon they are having disastrous powers without any accountability and responsiveness as the summon was use as a weapon with a threat of arrest and majority of the officers made spot recoveries from the taxpayers and after summon they directly block their ITC as available on the portal without any adjudication, therefore we request kindly take necessary action for spot recoveries and blocking of ITC which was done without following proper procedure as defined in Law, further we would like to draw your kind attention that arrest was made to a person who is not actually offender because there is no strict procedure and guidelines available for arrest which was as available in service tax and excise era..

Further, it is also important to note that now-a-days a taxpayer who is registered in a state was summoned by the officer who is situated in a different state and the officer was very well aware that the person was not belonged to his stare or jurisdictional territory, through this also the tax payers are facing tax terrorism in GST.

So, you are humbly requested to draw attention of respected finance minister madam on this issue and so that some fruitful action can be taken on this serious issue and safeguard of taxpayers can be ensured.

5. Sharing Information to Income Tax Department for Cases where no SCN or no adjudication is being made. That is, even before coming to any conclusion, sharing information to Income Tax department. The result is that the Income Tax department have started issuing notice u/s 148A of Income Tax Act 1961 and which is leading to tax terrorism.