Post 5 years of GST implementation, it is seen that GST still remains an evolving law, leave alone a settled law so to speak. While some of the issues are ironed out, there are still plenty of issues that need consideration in terms of ground level reality check.
GST is slowly moving from compliance to litigation. Scrutiny of returns, issuance of SCN, GST audits have started keeping in view the limitation period for FY 17-18 and 18-19 prescribed under the Act.
In this changing circumstance, the role and responsibility of professionals practicing in GST has become even more challenging, more so with continuous changes that are taking place almost after every GST council meet. It is sufficient to give us the impression that so far as GST is concerned, probably we have travelled a fair distance but the ultimate destination in terms of a settled law is still some distance to go.
Nevertheless it has been quite a journey so far and still remains so. In this backdrop, let me discuss some of my suggestions based on my practical experience on how to handle litigations under GST and how to represent the client's cases before the GST authorities.
First of all, at the very outset it has now become imperative rather an responsibility for the professionals to develop a deep sense of interpretation, understanding and absorption of the provisions of law and the applicability of the same in their client cases. this invariably requires the professionals to be conversant with the law in the first place which is absolutely essential when it comes to GST practice because if you are not fully conversant with the law itself, should an issue comes you are more likely to lend yourself and your client into trouble.
For this to happen, I suggest that the professionals must make it a habit to go through provisions of GST law and along with updates and circulars, notifications relevant on a regular basis. A good reference book on GST with commentaries may be referred to for this purpose and then after going through the provisions as well as all the analysis, one must try to form his or her own opinion to develop a deep sense of absorption of the law.
Next comes the importance of taking note of judgments and ratio decidendi laid down in those judgments before applying it to the facts and circumstances of the case. If an issue comes, first examine the notice or SCN itself so as to discern the facts and grounds on which it has been issued by the authority. Then collect all your facts and data pertaining to the issue raised therein.
Then figure out whether your case is factual only or involves some legal ground as well. once having decided, you have to jot down the factual arguments and legal arguments separately. At this stage you need to be very clear in your mind as to which stand you are taking and whether under the circumstances that stand would help your case or not. For example it is futile to go for legal arguments when your case is based purely on factual aspects and can be represented merely by going through factual explanations only.
If your case involves legal ground, think and jot down the possible legal arguments which are applicable to your case. Browse through the prominent case laws on the subject matter, make use of some good online or offiline tax liabrary or tax magazine. Identify the key applicable case laws which are in your favor, analyse the facts there and the ratio decidendi involved. also see if case law in your favor has been overruled or distinguished in another judgment which is very important. Do not quote a judgment unless its ratio decidendi is in your favor and the issue is identical or similar and it has been not overruled.
Sometimes you may across a situation where just going through the SCN or ASMT-10 or any other proceedings, you may find that the facts or figures mentioned therein are erroneous and does not match with the actual facts. For example while issuing ASMT-10 for alleged mismatch between GSTR-3B and 2A, the authorities may wrongly mention the amount of credit appearing in 2A whereas in fact 2A might show different amount of credit so you need to download 2A as on date and also compare it with the ITC as per 2A appearing in GSTR-9. If there is any discrepancy in the notice itself, you must bring it to the notice of the authority issuing such notice at the first instance only.
Finally, after throughly going through the provisions, matter in issue, legal and factual background along with applicable case laws if any, you may sat down to draft reply to the issue in hand. While drafting reply bear in mind the intricacy of the issue involved, whether in your opinion the issue is settled or not and whether the issue is likely to lead to further litigation at the higher level not just in your case but in general as well. Say for example the burning issue of demands created on account of alleged mismatches between the credit claimed in 3B and 2A.
Last but not the least, another challenge for the consultants and professional remains is that the departmental authorities more often than not are carrying their pre conceived notions. In most of the cases it will be seen that authorities themselves are not trained and knowledgeable enough to handle some of the complex issues that are coming out from their intelligence mechanism and communicated to them through Govt system.
in such cases a professional needs to stay calm while dealing with authorities and try to represent his client to the best of his ability. It is also better for a professional to admit if there is any lapse for which there is no recourse available. in such a case you have to be honest with your client as well and not try to satisfy client incorrectly. Instead be honest and tell him precisely that this much cannot be defended. At the same time art of advocacy must be learnt over a period of time which comes through practice and experience. The more issues you handle, the more ripe you become.
At all times maintain your composure and represent your client to the best of your knowledge and ability.
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