When it comes to the Goods and Services Tax (GST), there are various legal procedures and powers available to the authorities to ensure compliance and investigate any potential violations. One such power is the ability to issue summonses. In this article, we will delve into the concept of GST summons, including what they are, how they work within the legal framework, and what your rights and duties are when you receive a summons. We will also discuss the validity of summonses and the importance of understanding how they function in the GST system.
What is a Summon?
A summon is a legal document issued by a court or administrative agency that orders a specific individual to appear at a designated place and time before government authorities for a specific purpose. In the context of the GST Act 2017, a summon is a tool used by the proper officer to call upon any person whose attendance is deemed necessary for an inquiry. The summon is issued in the same manner as provided in the Code of Civil Procedure, 1908, which governs civil court proceedings.
Understanding Summon under the GST Act 2017
Under the GST Act 2017, a summon can be issued for any inquiry that the GST officer deems necessary. However, it is important to note that the power to summon is exercised in the same manner as a civil court, as specified in the Code of Civil Procedure, 1908. This means that the procedures and guidelines followed in civil court summonses are applicable to GST summonses as well.
Some common matters on which inquiries may be initiated through summonses include:
- Wrongly availing or utilizing input tax credit.
- Wrongly claiming GST refunds, with or without the intent to defraud.
- Non-payment or short payment of GST liability, with or without the intent to defraud.
- Differences in input tax credit claims between GSTR-3B and GSTR-2A/2B.
- Delay in filing GSTR-1 and GSTR-3B consecutively for more than six months.
- Inconsistent declarations in GSTR-1 and the e-way bill portal.
It is important for the proper officer to apply their mind and issue summonses only to individuals who are expected to have knowledge related to the inquiry. Summoning top management personnel should be avoided at the first instance unless their involvement is necessary for the purpose of the inquiry.
Rights of the Person Summoned
As a person who has been summoned under the GST Act, it is crucial to be aware of your rights. These rights are designed to ensure fairness and protect individuals during the summon proceedings. Some of the key rights include:
Right of Retraction
Taxpayers have the right to retract any earlier incorrect statements made during the summon proceedings. This allows them to correct any inaccuracies or mistakes and provide the correct information. It is important to retract statements as early as possible, as statements that have been retracted may not be admissible as evidence.
Right to Remain Silent
Under Article 20(3) of the Constitution of India, individuals who are summoned have the right to remain silent and not answer any questions if they choose not to. This right ensures that individuals are not compelled to be witnesses against themselves and protects them from self-incrimination.
Right to Cross-Examine
If any adverse statements are made by a third person during the summon proceedings, individuals have the right to cross-examine that person to verify the accuracy of the statements. This allows individuals to challenge and question the statements made by others.
Right to Refer to Documents
During the summon proceedings, individuals have the right to refer to any relevant documents or records to provide accurate information. This ensures that individuals can access and use supporting documents when answering questions or providing information.
Duty to Honor and Appear
As a person who has been summoned, it is your duty to honor the summons and appear before the authority or officer as directed. Ignoring a summons can lead to penalties under Section 122(3)(d) of the GST Act, which may extend up to twenty-five thousand rupees.
Duty to Submit Documents
If requested by the authorities, it is your duty to submit any relevant documents as required. This includes providing any documents that support your statements or are necessary for the inquiry. Failure to submit requested documents may result in adverse consequences.
Duty to Furnish Relevant Information
It is your duty to provide accurate and relevant information during the summon proceedings. This includes answering questions truthfully and to the best of your knowledge. Providing false statements may result in penalties under the Indian Penal Code.
Duty to Follow Legal Procedure
While exercising your rights, it is important to follow the due legal procedure as provided under the GST Act, 2017. This includes adhering to the guidelines and instructions given by the authorities, cooperating with the inquiry, and providing accurate information.
Duty to Not Conceal Material Information
As a person who has been summoned, it is your duty to not conceal any material information from the authorities. Material information is any information that is relevant to the inquiry and may impact the direction of the investigation. Concealing such information may lead to adverse consequences.
Duty to Not Appear at Odd Hours
While there is no express provision in the law that bars authorities from requiring your presence at odd hours, it is generally understood that you have the right to refuse to appear and cooperate at such times. This regulation ensures that you are not unnecessarily inconvenienced or subjected to undue hardship.
Duty to Follow Official Hours
When appearing for the summon proceedings, it is important to follow the official hours specified by the authorities. This ensures that the proceedings are conducted within the designated time frame and allows for proper documentation and record-keeping.
Validity of a Summon
For a summon to be valid under the GST Act, certain requirements must be met. These requirements include:
- The summon must be issued by the proper officer, as defined under the GST Act.
- The summon must be signed by the proper officer, and the seal should be affixed.
- The purpose of the summon should be clearly stated, and the date and time for appearance should be mentioned.
- The summon should not be vague and should provide the necessary details and information.
- The language used in the summon should not be unnecessarily harsh and should be justified in its issuance.
- The summon should not be issued repeatedly for the same purpose, and unnecessary delays should be avoided.
- The proper officer should obtain prior written permission from an officer not below the rank of Deputy/Assistant Commissioner before issuing the summon.
- The reasons for the issuance of the summon should be recorded in writing.
It is important for the authorities to ensure that summonses are issued in accordance with the law and the guidelines provided by the Central Board of Indirect Taxes & Customs (CBIC). These guidelines regulate the summon proceedings and provide instructions for the proper issuance and conduct of summonses.
In conclusion, understanding your rights, duties, and the validity of a summon is crucial when dealing with the GST Act. Summonses are powerful tools used by authorities to conduct inquiries and gather information. As a person who has been summoned, it is important to honor the summon, cooperate with the authorities, and provide accurate and relevant information. By understanding the legal procedures and your rights, you can navigate the summon proceedings effectively and ensure a fair and just process.
The author is a Practicing Chartered Accountant and Author of many books in GST. He is also a National Speaker and Trainer on GST. He can be approached at email@example.com. He conducts webinar and certificate courses with CAclubindia.