PROPER OFFICER

[Mr. M. GOVINDARAJAN]

Introduction

The GST Acts of Central as well States empowers the respective Governments to appoint officers as per requirement to administer the GST regime.  In many of the provisions we may come across the term ‘proper officer’ to deal with such cases.  Therefore we have to check in any action by the Department whether the action has been initiated by the proper officer.  In some provisions we may see the expression ‘deemed proper officer’.  Rule 13 of  ‘Anti-Profiteering Rules,2017’  which got the approval of the GST Council in its meeting held on 18.05.2017, provides that the Director General of Safeguards, or an officer authorized by him in this behalf shall be deemed to be the proper officer to exercise such power to summon any person whose attendance he considers necessary either to give evidence or to produce a document or any other thing under section 70 and shall have the power in any inquiry in the same manner, as provided in the case of a civil court under the provisions of the Code of Civil Procedure, 1908.

Proper Officer

Section 2(91) of CGST Act, 2017 defines the expression ‘proper officer’ in relation to any function to be performed under this Act means the Commissioner or the officer of the central tax who is assigned that function by the Commissioner in the Board.

According to the above definition, the proper officer shall be the Commissioner of GST in the Board unless he authorizes any officer to perform such function as prescribed by him.

The Central Government vide Notification No. GST ( ) E, dated 19.06.2019 made the Goods and Services Tax Rules, 2017 which came into effect from 22.06.2017 in which the Government notified Composition Rules in Chapter II and Registration Rules in Chapter III.

Vide Circular No.1/1/2017, dated 26.06.2017 the Commissioner (GST), in exercise of his powers conferred by section 2(91) of the CGST Act read with section 20 of IGST Act, 2017 and subject to section 5(2) of the said Act, the Board assigned the following officers, the functions as the proper officers in relation to various sections of the said Act or the rules made there under in relation to composition levy and registration-

• Assistant or Deputy Commissioners of Central Tax and Assistant or Deputy Directors of central taxare assigned as proper officers for the following functions-

Under Composition levy

• Under section 10(5) – this section provides that if the proper officer has reasons to believe that a taxable person has paid tax under section 5(1) despite not being eligible, such person shall, in addition to any tax that may be payable by him under any other provisions of this Act, be liable to a penalty and the provisions of section 73 or section 74 shall, mutatits mutandis apply for determination of tax and penalty;
• Rule 6 – Rule 6 of Central Goods and Services Tax Rules, 2017 deals with the procedure of validating of composition levy.  Rule 6(4) provides that where the proper officer has reasons to believe  that the registered person was not eligible to pay tax under section 10 or has contravened the provisions of the Act or provisions of this Chapter, he may issue a notice to such person in Form GST CMP – 05 to show cause within 15 days of the receipt of such notice as to why the option to pay tax under section 10 shall not be denied.  Upon receipt of the reply to the show cause notice from the registered person in Form GST CMP – 06, the proper officer shall issue an order in accepting the reply, or denying the option to pay tax under section 10 from the date of the option or from the date of the event concerning such contravention, as the case may be.

Under Registration procedure

• Proviso to section 27(1) - Section 27(1) provides that the certificate of registration issued to a casual taxable person or a non resident taxable person shall be valid for the period specified in the application for registration or 90 days from the effective date of registration, whichever is earlier and such person shall make taxable supplies only after the issuance of the certificate of registration.

The first proviso to section 27(1) provided that the proper officer may, on sufficient cause being shown by the said taxable person, extend the said period of 90 days by a further period not exceeding 90 days.

• Section 30 – Revocation of cancellation of registration – Section 30(1) provides that subject to such conditions as may be prescribed, any registered person, whose registration is cancelled by the proper officer on his own motion, may apply to such officer for revocation of cancellation of the registration in the prescribed manner within 30 days from the date of service of the cancellation order.  The proper officer may, in such manner and within such powers as may be prescribed, by order, either revoke cancellation of the registration or reject the application. 
• Rule 23 – This rule prescribes the procedure for revocation of cancellation of registration by the proper officer-

• A registered person, whose registration is cancelled by the proper officer in his own motion, may submit an application or revocation of cancellation of registration in Form GST REG-21 to such proper officer, within a period of 30 days from the date of service of the order of cancellation of registration at the Common Portal;
• If the proper officer is satisfied , for reasons to be recorded in writing, that there are sufficient grounds for revocation of cancellation of registration, he shall revoke the cancellation of registration by an order in Form GST – 22 within a period of 30 days from the date of the receipt of the application and communicate the same to the applicant;
• The proper officer may, for reasons to be recordedin writing, by an order in Form GST REG – 05, reject the application for revocation of cancellation of registration and communicate the same to the applicant;
• Before passing the order the proper officer shall issue a notice in Form GST REG-23 requiring the applicant to show cause as to why the application submitted for revocation should not be rejected and the applicant shall furnish the reply within a period of 7 working days from the date of the service of the notice in Form GST REG – 24;
• On receipt of the information in clarification in Form GST REG – 24, the proper officer shall proceed to dispose of the applicationwithin a period of 30 days from the date of the receipt of such information or clarification from the applicant;

• Rule 25 – Physical verification of business premises in certain cases – This rule provides that where the proper officer is satisfied that the physical verification of the place of business of a registered person is required after the grant of registration, he may get such verification done and the verification report along with the other documents, including photographs, shall be uploaded in Form GST REG – 30 on the common portal within a period of 15 working days following the date of such verification;

• Superintendent of central tax – He is the proper officer in the following cases-

Under Registration

• Section 25(8) – Section 25 provides the procedure for registration.  Section 25(8) provides that where a person who is liable to be registered under this Act fails to obtain registration, the proper officer may, without prejudice to any section which may be taken under this Act or under any other law for the time being in force, proceed to register such person in such manner as may be prescribed;
• Section 28 – Amendment of registration – Section 28(2) provides that the proper officer may on the basis of information furnished by the registered person for amendment of registration, approve or reject amendments in the registration particulars in such manner and within such period as may be prescribed.  The proper officer shall not be required in respect of amendment of such particulars as may be prescribed.  The proper officer shall not reject the application for amendment in the registration without giving the person an opportunity of being heard;
• Section 29 – Cancellation of registration – The proper officer may, either on his own motion or on an application filed by the registered person or by his legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where-

• the business has been discontinued, transferred fully for any reason including death of the proprietor, amalgamated with other entity, demerged or otherwise disposed of; or
• there is any change in the constitution of the business; or
  • the taxable person, other than the person registered under section 25(3), is no longer liable to be registered under section 22 or 24;

The proper officer may cancel the registration of a person from such date including any retrospective date, as he may deem fit, where-

• a registered person has contravened such provisions of the Act or the rules made there under as may be prescribed; or
• a person paying tax under section10 has not furnished returns for three consecutive tax period; or
• any registered person, other than a person specified above has not furnished returns for a continuous period of six months; or
• any person who has taken voluntary registration under section 25(3) has not commenced business within 6 months from the date of registration; or
• registration has been obtained by means of fraud, willful misstatement or suppression of facts;

The proper officer shall not cancel the registration without giving the person opportunity of being heard.

• Rule 9 – Verification of the application and approval – This rule prescribes the procedure by the proper officer for verification of the application and approval of the application for registration;
• Rule 10 – Issue of registration certificate – This rule prescribes the procedure for issue of registration certificate.  Rule 10(4) provides that every certificate of registration shall be digitally signed by the proper officer under the Act;
• Rule 12 – Grant of registration to persons required to deduct tax at source or to collect tax at source – This rule prescribes the procedure for the grant of registration to persons required to deduct tax at source or to collect tax at source, after due verification by the proper officer;
• Rule 16 – suo-motu registration  - This rule prescribes the procedure for the proper officer to register a person who is liable to registration under this Act, on a temporary basis and issue an order in Form GST REG – 12;
• Rule 17 – Assignment of Unique Identity Number to certain special entities – This rule prescribes the procedure to grant UIN to a person who requires to obtain the same;
• Rule 19 – Amendment of registration – This rule prescribes the procedure by the procedure to amend the registration on the application furnished by the registered person;
• Rule 22 – Cancellation of registration – This rule prescribes the procedure by the proper officer  to cancel the registration certificate;
• Rule 24 – Migration of persons registered under the existing law – This rule prescribes the procedure by the proper officer in migrating the persons registered under the existing laws.