SC directs GST Council to issue advisory to States to implement DIN system

The Supreme Court has ordered the GST Council to issue advisories to all states, encouraging the implementation of a Document Identification Number (DIN) system. This system aims to enhance transparency and accountability in indirect tax administration by electronically identifying all communications between state tax officers and taxpayers. The Court believes this move is in the public interest and will improve good governance.

The Hon'ble Supreme Court in Pradeep Goyal v. Union of India & Ors. [Writ Petition (Civil) No. 320 of 2022 dated July 18, 2022] held that implementation of Document Identification Number ("DIN") for intimating communications sent by the State Tax Officers/Other Officials, would be beneficial in the larger public interest to enhance good governance and to bring transparency and accountability in the indirect tax administration.

Facts

Mr. Pradeep Goyal ("the Petitioner") a Chartered Accountant by profession, sought relief in the form of Public Interest Ligation ("PIL") against issuance for an appropriate writ, order or direction to the respective States and the GST Council ("the Respondent") to take necessary steps to implement a system for electronic generation of a DIN to bring transparency and accountability in the indirect tax administration in order to facilitate communication channel between the state tax officers/concerned officials and the taxpayers.

The Respondent in agreement with the Petitioner also sought for implementation of electronic DIN, pointing out that the implementation of the same would bring transparency and accountability in the indirect tax administration. However, on the aspect of implementation, the concerned State has to take the initiative for its implementation. Further submitted that the GST Council has substantive powers drawn from the Constitution of India to issue advisory and make recommendations to the States for generation of electronic DIN for all communications being shared amongst the State Tax Authorities/other officials and the taxpayers.

Issue

Whether implementation of electronic DIN necessary to facilitate communication between the State Tax Authorities/other officials and the taxpayers?

Held

The Hon'ble Supreme Court in Writ Petition (Civil) No. 320 of 2022 dated July 18, 2022 held as under:

• Observed that the GST Council is empowered to make recommendations to the States on any matter relating to GST. The GST Council can also issue advisories to the respective States for implementation of the DIN system, which shall be in the larger public interest and which may bring in transparency and accountability in the indirect tax administration.
• Opined that, implementing the system for electronic generation of a DIN for all communications sent by the State Tax Officers to taxpayers and other concerned persons would be in the larger public interest and enhance good governance. It will bring in transparency and accountability in the indirect tax administration, which are so vital to efficient governance.
• Directed the GST Council to issue advisory/instructions/recommendations to the respective States regarding implementation of the system of electronic DIN.