Intelligence wing - Structure. - GST - States - 09/2019

Circular No.9/2019 Q1/17253/2019 Office of the Commissioner of Commercial Taxes, Chepauk, Chennai - 5 Dated 24.05.2019 Present: Dr T.V. Somanathan, I.A.S., Additional Chief Secretary / Commissioner of Commercial Taxes, Sub : Intelligence wing - structure. The Intelligence wing shall be structured as hereunder with effect from 01.06.2019 for effective functioning and achieving the desired result without harassing the taxpayers: A. The Central Intelligence wing: This wing will function under the direct control of the Commissioner and will be assisted by the Additional Commissioner (Intelligence). This wing will consist of (i). Investigation unit headed by Joint Commissioner (Investigation) and (ii). Coordination unit headed by Deputy Commissioner (Intelligence). (1). The Investigation unit shall examine and study the pattern and modus operandi of tax evasion based on the data gathered from Data cell which would consist of one internal data collection section for collection of data available within the Department and another section for collection of data from external sources like Customs, Excise, Service Tax, Income Tax, DRI, DGFT, Railways, Ports, SEZ, Air Cargo Authority, Other state Commercial Taxes Departments, Banks, Registration Departments, Tourism Department, local bodies, agencies like Tamil Nadu Electricity Board, National Highways Authority of India, Chennai Metropolitan Development Authority, etc.; and also from the Survey cell which is constituted for the purpose of (1). Market Survey; (2). Study and analyse the market price of such commodity as may be referred to by the Commissioner or such other commodities, after getting the permission from the Commissioner and (3). Test purchases, if so directed by the Commissioner. Additionally, it is also proposed to have a Technical cell to retrieve hidden / deleted / remotely located data with adequate tools and this cell will also help the Investigation unit by providing necessary technology based inputs. b) Functions: i). Gathering data from the Technical cell, Data Collection cell and Survey cell for processing and preparation of Investigation File for conducting inspection. ii). Examination of complaints and allegations petitions received on tax evasion and preparation of investigation file, wherever necessary. iii). This cell shall prepare investigation file mainly in respect of (a) cases or segments or issues where the revenue impact is significant and widespread all over the State; (b). Taxable persons involved in a transaction leading to tax evasion are located in more than one Division or State.; (c). Complaints and allegations of tax evasion and (d) cases referred to by the Commissioner. iv). The investigation file shall be submitted to the Commissioner of Commercial Taxes through the Additional Commissioner (Intelligence) for approval. v). Conducting test purchase of goods and services through the Survey cell as per the direction or orders of the Commissioner. vi). Any other functions pertaining to tax evasion, as may be assigned by the Commissioner or the Additional Commissioner. (2). Co-ordination unit: This unit will be headed by the Deputy Commissioner-II (Intelligence). This unit shall examine the investigation file received from the Intelligence Division and get approval from the Commissioner through the Additional Commissioner (Intelligence). This unit is also responsible for the preparation of statistics and reports on inspections. (The proposed set up and functions of Central Intelligence wing is given in Annexure-I) B). Intelligence Division: There will be nine Intelligence Divisions all over the State and each Intelligence Division shall be headed by a Joint Commissioner (Intelligence). At present several groups consisting of a State Tax Officer and two Deputy State Tax Officers are functioning for conducting inspections and many Roving Squads consisting of same number of Officers for checking goods in movement [transit are also functioning under the control of Deputy Commissioners in Chennai. However, in Intelligence Divisions other than Chennai, the inspection Groups and the Roving squads are functioning under the control of Deputy Commissioners or Assistant Commissioners, as the case may be. The activities of the groups and Roving squads are normally confined or linked to a specified assigned geographical territory. Considering the nature of business, expansion of the business area and different modus operandi of tax evasion and on the expectation of cross border operation of tax evasion because of the availability of input tax credit, it is decided to constitute specialized cells for gathering data, market survey and for preparing investigation file based on the inputs received from these cases. It is also decided to conduct intelligence-based inspection instead of random inspection. As per G.O.Ms No.30 CT R (A2) Department dated 04.03.2019 it has been decided to have only one permanent squad in each Intelligence Division and utilize the surplus officers and staff to constitute the Data cell, Survey cell, Adjudicating cell and Collection cell in each Intelligence Division. Nevertheless, liberty is given to the Joint Commissioner (Intelligence) to form Squads as he may deem fit based on exigencies of work and actual necessity subject to a maximum of 4 more squads per Division outside Chennai and 8 more squads per Division in Chennai I Il. Personnel shall be drawn randomly from a pool consisting of officers and staff from both the Intelligence Division and the Territorial Division corresponding to the Intelligence Division; normally in the ratio 1:2 i.e., a squad shall contain one Officer from Intelligence and two officers from the Territorial Division corresponding to the Intelligence Division. Accordingly, it is proposed to restructure the functioning of the Intelligence wing with the following units at the Divisional Level: (a). Investigation unit: This unit shall be headed by the Deputy Commissioner (Investigation) in both the Intelligence Divisions of Chennai and it shall be headed by (an Assistant Commissioner (Intelligence)) in other Intelligence Divisions. This unit shall examine and study the pattern and modus operandi of tax evasion based on the data collected from the Technical cell, Data cell and Survey cell and prepare investigation file. The Data cell would consist of one internal data collection section for collection of data available within the Department and another section for collection of data from external sources like Customs, Excise, Service Tax, Income Tax, DRI, DGFT, Railways, Ports, SEZ, Air Cargo Authority, Other state Commercial Taxes Departments, Banks, Registration Departments, Tourism Department, local bodies, agencies like Tamil Nadu Electricity Board, National Highways Authority of India, Chennai Metropolitan Development Authority, etc...The Survey Cell will conduct (1).Market Survey; (2). Study and analyse the market price of such commodity as may be referred to by the Joint Commissioner(Intelligence) or such other commodities after getting the permission from the Joint Commissioner (Intelligence) and (3). Test purchases, if so directed by the Joint Commissioner (Intelligence). The Joint Commissioners (Intelligence) may utilize the service of the Technical cell functioning under the Central Intelligence Unit, for retrieval of hidden / deleted / remotely located data. (b). (i). The Inspection unit shall be under the control of Deputy Commissioner (Inspection) and will consist of: (1). Inspection cell comprising of officers not below the rank of Deputy State Tax Officer. However, the inspection team will be constituted by the Joint Commissioner (Intelligence) and the inspection shall be supervised by the Deputy Commissioner (Inspection) and he shall report to the Joint Commissioner (Intelligence) at the Divisional Level. Functions of the inspection cell: i). Inspection of business premises, transporters place or any other places based on the authorization issued by the Joint Commissioner (Intelligence). ii) The head of the cell or any other officer authorized by the Join Commissioner (intelligence) shall make Adjudication/ assessment on the basis of findings made during the inspection. (b). (ii). Review cell comprising of officers not below the rank of State tax Officers shall perform the following functions: (1). Review of the orders passed by the group head of the inspection cell, or by any authorized officer, Roving squad and Adjudicating Authorities for filing first appeal. (2). Review of the order passed by the First Appellate Authority for filing 2 nd appeal before the Tribunal. (b). (iii). Demand Collection cell is constituted for watching the Collection of the demand raised by the inspection cell and adjudication cell and initiate arrear action to collect the demand, in case the demand is not paid within the period stipulated in the demand notice. (c). Apart from the above, another three cells viz., (i). Adjudication cell, (ii). Legal cell and (iii).Roving Squad will function under the direct control of the Joint Commissioner (Intelligence) and they shall perform the following functions: (i). Adjudication cell: Adjudicating issues arising out of detention of goods and vehicles by Roving Squad (other than those decided on the spot by the Roving squad) and other cases referred to by the Joint Commissioner. (ii). Legal cell: Coordination with Legal wing in Commissioners Office, Government Law Officers in respect of cases pending in various forums and any other issues as may be referred by the Joint Commissioner (Intelligence); assisting the Joint Commissioner (Intelligence) to exercise the power of revision under section 108 of the Act. (iii). Roving Squad to inspect goods in movement and levy of tax, penalty, C-fee on the spot for offences and hand over such cases in respect of which the adjudication is not finalized during the duty hours. [The proposed set up and functions of Intelligence Division is given in Annexure-II (Intelligence Wing-I, Chennai and Intelligence-Il, Chennai), Annexure-Ill (Coimbatore and Erode Intelligence Division) and Annexure-IV (Vellore, Trichy, Salem, Madurai and Tirunelveli Intelligence Division)] Encl : Annexure I to IV Sd/- T.V.Somanathan, Additional Chief Secretary/ Commissioner of Commercial Taxes