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The GST council should consider that taxpayers are the real nation builders. If they will be burdened with such haste compliances and bureaucracy, there will be an adverse impact on trade as in general. The law should punish the evaders but shall not cause harassment to everyone in general who pay their taxes honestly, due to some minor non-compliances. I urge the GST council and Ministry of Finance to consider this hardship to GST assesses and resolve these issues. Here are some points that I think should be focused upon:

Limited appeal filing time given.

Open letter to the Ministry of Finance and GST Council

Any person aggrieved by any decision or order passed under the GST Act may appeal to Appellate Authority within three months from the date on which the said decision or order is communicated to such person. It is a very limited time frame for the assessee to make an appeal. Also, the assessee has to pre-deposit at least 10% of the disputed tax amount before making an appeal, which again becomes the problem for the taxpayer since many times assessing authority assess the tax at very high end than the actual liability. Also, the assessee may be unable to move to appeal within such a limited time period due to his business or other involvements or any emergency situations.

Non-withdrawal of assessment orders even after payment of taxes

As per Sec 62 of the CGST Act, if the taxpayer files his return within 30 days of assessment order under the said section, the assessment order is withdrawn. However, this order remains stand where the taxpayer files his return after the expiry of 30 days from the date of the notice.  This results in double tax liability on the taxpayer since where he has filed his return for the said order, he has to pay the demand also outstanding in the said order. In case the taxpayer files his return after 3 months from the date of order, no remedy is available to the taxpayer since the time limit for filing an appeal against such order also lapses. This provisions of GST Act are against the principles of natural justice since the legitimate taxpayer’s liability is increased substantially where he misses a very short deadline available to his remedy. Also the taxpayer may face recovery proceedings by the department where he does not have sufficient funds to pay such huge liability.

Assessment made by the officer is on the unusually higher side


In many cases it is seen where the assessing officers have made best judgment assessments like Sec 62 of CGST Act, in case of nonfilers of return, the assessments are made on a very high end i.e. considering the turnover very much high as compared to actual turnover of the assessee and thus resulting into high tax demands along with high interest and penalty. In a time where especially the small and medium business is struggling with economic recession, this kind of assessments may break the backbones of the business and land them on the verge of shutdown. Also where the taxpayer decides to move to appeal, he is required to deposit 10% of the above demand before, which may cause hardship to the assessee.


Harassment to the assessees

GST law requires that if an assessee does not file his return within due date, he shall be immediately issued a notice requiring him to furnish the return within 15 days, failing to which, the tax is being assessed by assessing officer according to his best judgment (Circular No. 129/48/2019 – GST). GST law already levies the late fees on a per-day basis if the assessee fails to furnish the return. Since the returns are to be filed on monthly basis, many times it may so happen that the assessee may not be able to file the return due to some genuine reason beyond his control or due to business reasons like nonreceipt of invoice, etc. In that case, levying of late fees is unjust, but this kind of assessment within a very short time is totally harassment to all the taxpayers.  Also, the service of such notice is made on email. If a person fails to check his mails at regular intervals, he may get into trouble since the above circular states that “no further communication will be issued for assessing the liability”, so if one misses seeing that mail, he will only see the assessment order and demand next.

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Category GST, Other Articles by - Parag Lakhotia