In India we follow dual GST model i.e for Intra State trade or commerce, centre shall levy and collect CGST (Central Goods and Services Tax) and State/ UT will levy and collect SGST (State Goods and Service Tax)/ UTGST (Union Territory Goods and Services Tax), where as for Inter State trade or commerce, centre will levy and collect IGST (Integrated Goods and Services Tax) which is basically a summation of CGST and SGST/UTGST; out of which CGST part will be retailed by centre and corresponding SGST/UTGST part will be transferred to the corresponding consuming State/ UT.
Since two authorities (centre and state) are involved for each transactions, a need of single interface was must so that a taxpayer does not have to interact with multiple authorities and hence during the course of finalizing the form and structure of administering GST, the idea of single interface for an individual taxpayer emerged. In this scheme the GSTN will through up the list of registered taxpayers which will indicate the tax authority that an individual taxpayer should interact with.
Hence in this regards, an authorization would be needed for the Central GST Officers to collect and administer State GST/UT GST and vice versa for Intra State/ UT transactions. Similar authorization would be needed for the State/ UT GST officers to collect IGST for Inter State/ UT trade or commerce and as an outcome, provision for cross empowerment by empowering State GST/ UTGST administration to collect CGST has been provided in Section 6 of the Central GST Act. Similar provisions for empowering the centre are there in Section 6 of the SGST and UTGST Acts.
Provisions for cross empowerment by empowering States and Union Territories to collect IGST has been provided in Section 4 of the IGST Act.
Legislative Provisions:
The above discussed provisions are discussed below:
Section 6 of CGST Act
6. (1) Without prejudice to the provisions of this Act, the officers appointed under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act are authorised to be the proper officers for the purposes of this Act, subject to such conditions as the Government shall, on the recommendations of the Council, by notification, specify.
(2) Subject to the conditions specified in the notification issued under sub-section (1),––
- (a) where any proper officer issues an order under this Act, he shall also issue an order under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as authorised by the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as the case may be, under intimation to the jurisdictional officer of State tax or Union territory tax;
- (b) where a proper officer under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act has initiated any proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act on the same subject matter.
(3) Any proceedings for rectification, appeal and revision, wherever applicable, of any order passed by an officer appointed under this Act shall not lie before an officer
appointed under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act.
Section 6 of UTGST Act
6. (1) Without prejudice to the provisions of this Act, the officers appointed under the Central Goods and Services Tax Act are authorised to be the proper officers for the purposes of this Act, subject to such conditions as the Government shall, on the recommendations ofthe Council, by notification, specify.
(2) Subject to the conditions specified in the notification issued under sub-section (1),—
- (a) where any proper officer issues an order under this Act, he shall also issue an order under the Central Goods and Services Tax Act, as authorised by the said Act under intimation to the jurisdictional officer of central tax;
- (b) where a proper officer under the Central Goods and Services Tax Act has initiated any proceedings on a subject matter, no proceedings shall be initiated by the proper officer under this Act on the same subject matter.
(3) Any proceedings for rectification, appeal and revision, wherever applicable, of any order passed by an officer appointed under this Act, shall not lie before an officer appointed under the Central Goods and Services Tax Act.
Section 4 of IGST Act
4. Without prejudice to the provisions of this Act, the officers appointed under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act are authorised to be the proper officers for the purposes of this Act, subject to such exceptions and conditions as the Government shall, on the recommendations of the Council, by notification, specify.
Enforcement Provisions vis-a-vis Cross Empowerment:
Division of Work between Centre and State/ UT
As on outcome of the cross empowerment, the GST council’s decision has been that for taxpayers below Aggregate turnover of Rs 1.5 crores, the states/ UT would administer bot CGST and SGST/ UTGST for 90% of the taxpayers and the balance 10% for the centre (Both for Inter State/ Intra State transactions). Above the threshold of Rs 1.5 crores, the taxpayer base will be divided between centre and state/ UT as 50:50.
In Transit Goods
Enforcement in regards goods is movement/ in transit is not pre-determined and has to be conducted on ad hoc basis and hence the provisions of threshold limit of centre and state/ UT and cross empowerment is required to be more flexible.
Legislative provisions
129. (1) Notwithstanding anything contained in this Act, where any person transports any goods or stores any goods while they are in transit in contravention of the provisions of this Act or the rules made thereunder, all such goods and conveyance used as a means of transport for carrying the said goods and documents
relating to such goods and conveyance shall be liable to detention or seizure and after detention or seizure, shall be released,––
- (a) on payment of the applicable tax and penalty equal to one hundred per cent. of the tax payable on such goods and, in case of exempted goods, on payment of an amount equal to two per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods comes forward for payment of such tax and penalty;
- (b) on payment of the applicable tax and penalty equal to the fifty per cent. of the value of the goods reduced by the tax amount paid thereon and, in case of exempted goods, on payment of an amount equal to five per cent. of the value of goods or twenty-five thousand rupees, whichever is less, where the owner of the goods does not come forward for payment of such tax and penalty;
- (c) upon furnishing a security equivalent to the amount payable under clause (a) or clause (b) in such form and manner as may be prescribed:
Provided that no such goods or conveyance shall be detained or seized without serving an order of detention or seizure on the person transporting the goods.
(2) The provisions of sub-section (6) of section 67 shall, mutatis mutandis, apply fordetention and seizure of goods and conveyances.
(3) The proper officer detaining or seizing goods or conveyances shall issue a notice specifying the tax and penalty payable and thereafter, pass an order for payment of tax and penalty under clause (a) or clause (b) or clause (c).
(4) No tax, interest or penalty shall be determined under sub-section (3) without giving the person concerned an opportunity of being heard.
(5) On payment of amount referred in sub-section (1), all proceedings in respect of the notice specified in sub-section (3) shall be deemed to be concluded.
(6) Where the person transporting any goods or the owner of the goods fails to pay the amount of tax and penalty as provided in sub-section (1) within seven days of such detention or seizure, further proceedings shall be initiated in accordance with the provisions of section 130:
Provided that where the detained or seized goods are perishable or hazardous in nature or are likely to depreciate in value with passage of time, the said period of seven days may be reduced by the proper officer.
In a nut shell, Penalty under section 129 can be broadly classified as under:
If any person transports any goods or stores any such goods while in transit without the documents prescribed or supplies or stores any goods that have not been recorded in the books or accounts maintained by him, then such goods shall be liable to for detention along with any vehicle on which they are being transported.
Also it has been decided by Hon'ble Kerala High Court in ASCICS Trading Company Vs. Assistant State Tax Office, Aluva [2017(6) GSTL 385 (ker.)] that-
Although the power to prescribe the documents that are to be accompany the transportation of goods in the course of inter-State trade is conferred on the Central Government, the Central Government has, till date, not notified the documents that have to be carried by a transporter of the goods in the course of inter-State movement. Under the said circumstances, and finding that neither the State Legislature nor the State Government would have power to make laws/ rules to govern inter-state movements of goods in the course of trade and for the purposes of levy of tax detention for the sole reason that the transportation was not accompanied by the prescribed documents under IGST Act/ CGST Act/ CGST Rules, cannot be legally sustained.
Conclusion:
It is evident from the current situation that there has been a lot of confusions in regards the respective authorities applicable to the tax payers and their jurisdiction but there has been a constant efforts by the law makers to navigate accordingly.
Constitutionally, a reading of the provisions of the Articles 246A and 269A makes it clear that with respect to interstate supplies, parliament has the exclusive power to make laws relating to GST and in respective to intrastate supplies, both parliament and state legislatures have power to make laws with respect to respective heads but Section 6 and Section 4 of CGST/SGST/UTGST and IGST has also provided the clause of cross empowerment and as of now there is no restrictions or specific exclusions provided by way of notification restricting any state/ UT authority to be proper officer in central tax or vice versa.
Compiled By:
CA. Archit Singla
archit_singla@outlook.com
+918930809000
|
|
Situation
|
Quantum of Penalty
|
|
Situation A.
|
Where owner comes forward:
|
Such goods shall be released on payment
of the applicable tax and penalty equal to 100% tax or upon furnishing of
security equivalent to the said amount.
|
|
|
|
In case of exempted goods, penalty is
2% of value of goods or Rs 25,000/- whichever is lesser.
|
|
|
|
|
|
Situation B.
|
Where owner does not come forward:
|
Such goods shall be released on payment
of the applicable tax and penalty equal to 50% of value of goods or upon
furnishing of security equivalent to the said amount.
|
|
|
|
In case of exempted goods, penalty is
5% of value of goods or Rs 25,000/- whichever is lesser.
|
|
|
|
|
Also it has been decided by Hon'ble Kerala High Court in ASCICS Trading Company Vs. Assistant State Tax Office, Aluva [2017(6) GSTL 385 (ker.)] that-
Although the power to prescribe the documents that are to be accompany the transportation of goods in the course of inter-State trade is conferred on the Central Government, the Central Government has, till date, not notified the documents that have to be carried by a transporter of the goods in the course of inter-State movement. Under the said circumstances, and finding that neither the State Legislature nor the State Government would have power to make laws/ rules to govern inter-state movements of goods in the course of trade and for the purposes of levy of tax detention for the sole reason that the transportation was not accompanied by the prescribed documents under IGST Act/ CGST Act/ CGST Rules, cannot be legally sustained.
Conclusion:
It is evident from the current situation that there has been a lot of confusions in regards the respective authorities applicable to the tax payers and their jurisdiction but there has been a constant efforts by the law makers to navigate accordingly.
Constitutionally, a reading of the provisions of the Articles 246A and 269A makes it clear that with respect to interstate supplies, parliament has the exclusive power to make laws relating to GST and in respective to intrastate supplies, both parliament and state legislatures have power to make laws with respect to respective heads but Section 6 and Section 4 of CGST/SGST/UTGST and IGST has also provided the clause of cross empowerment and as of now there is no restrictions or specific exclusions provided by way of notification restricting any state/ UT authority to be proper officer in central tax or vice versa.
Compiled By:
CA. Archit Singla
archit_singla@outlook.com
+918930809000
No comments:
Post a Comment