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TMI Blog2021 (1) TMI 702X X X X Extracts X X X X X X X X Extracts X X X X ..... action of the State and Central Authorities is overlapping, the Petitioner would be at liberty to take action to impugn the same in accordance with law. Absence of the two independent witnesses - HELD THAT:- There is no panchnama on record. In essence, the main thrust of Petitioner s argument is that the statement of Mr. Rajeev Gupta does not record the presence of the two independent witnesses or signatures, making the search action illegal. We have already dealt with the contention of the Petitioner regarding the alleged involuntary/forced statement and in view of our observations made hereinabove, this issue, is rendered insignificant. Further, no specific provision is shown to us that deals with recording of statement in search action. The only relevant section is Section 70, which does not entail signatures of witnesses. Be that as it may, determination of tax liability, has to be in accordance within the confines of statutory provisions of the GST laws. We reiterate that the evidentiary value of the aforenoted statement, and the effect of payment of tax and interest made pursuant thereto, are issues which would have to be gone into at the stage of adjudication. There ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... allowed, subject to just exceptions. 2. The application is disposed of. W.P.(C) 121/2021 3. The present writ petition under Article 226 of the Constitution of India, 1950 impugns the action of search carried out at the Petitioner s business premises on 30th September, 2020, under Section 67 of the Delhi Goods and Services Tax Act, 2017 (hereinafter referred to as DGST Act ) read with Rule 139 of the DGST Rules, 2017. 4. The factual matrix giving rise to the present writ petition is as follows: The Petitioner company, duly registered under the CGST/ DGST Act, functions from its unit at Pitampura, North-West Delhi and has its godown/warehouse at Shahbad, Daulatpur, Delhi. It also has units in other states for which separate registration under the CGST Act exists at Rajasthan and Himachal Pradesh. On 30th September, 2020 at 3:30 PM, the Respondent No. 2 (Assistant Commissioner/VATO, Delhi) entered the Petitioner s place of business and godown, for the purpose of conducting a search. Petitioner was handed over a notice by Respondent No. 2 under Rule 56(18) of DGST Rules, 2017, inter-alia asking to produce books of accounts for the period 2017-18, 2018-19, 2019-20, and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... his Act on any other officer of State tax who is subordinate to him. (3) The Commissioner may, subject to such conditions and limitations as may be specified in this behalf by him, delegate his powers to any other officer who is subordinate to him. (4) Notwithstanding anything contained in this section, an Appellate Authority shall not exercise the powers and discharge the duties conferred or imposed on any other officer of State tax. Section 6: Authorisation of officers of central tax as proper officer in certain circumstances (1) Without prejudice to the provisions of this Act, the officers appointed under the Central Goods and Services Tax Act, 2017 (Central Act 12 of 2017) are authorised to be the proper officers for the purposes of this Act, subject to such conditions as the Government shall, on the recommendations of the Council, by notification, specify. (2) Subject to the conditions specified in the notification issued under sub-section (1),- (a) where any proper officer issues an order under this Act, he shall also issue an order under the Central Goods and Services Tax Act, 2017 (Central Act 12 of 2017) as authorised by the said Act under ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... witnesses were available but notwithstanding this fact, the search action is still valid. In support of his submission, Mr. Singh relies upon three judgments being State Of Punjab v. Wassan Singh And Ors, (1981) 2 SCC 1; Sahib Singh v. State Of Punjab, (1996) 11 SCC 685; and Kalpnath Rai v. State (Through CBI), (1997) 8 SCC 732. 10. Mr. Singh clarifies that there is no parallel investigation being carried out by the DGST authorities, as is portrayed by the Petitioner. To elucidate his contention, he submits that although the earlier notice issued under Rule 56(18) of the DGST Rules, 2017 requisitioned the documents for the period from 2017-18 to 2020-2021, but now the fresh notice is confined to 2020-21. As regards the contention of mentioning of the provisions of the Delhi Value Added Tax Act, 2004, he submits that the said provisions are saved in terms of Section 174(2)(c) of the CGST Act, 2017 and therefore, the rules framed thereunder and the DVAT Act can be resorted to for the purpose of adjudication, insofar as the dues pertain to the period prior to the promulgation of the CGST Laws. Lastly Mr. Ramesh Singh further states that the ground of coercion in respect of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Petitioner. The primary ground concerns the assumption of jurisdiction by the DGST authorities based on the plea of parallel investigation, the contention is borne out of the notice dated 30th September, 2020 shown to us, whereby the documents for the period of 2017-18 to 2020-21 are being requisitioned. Mr. Babbar states that since DGGI has issued a show-cause notice under Section 74 of the CGST Act, for the years 2017-18 and 201819, then by virtue of Section 6 of CGST Act, the DGST authorities cannot carry out the investigation for the said period. To our mind, the request in the notice dated 30th September, 2020 cannot ipso facto lead to the conclusion that there is a parallel investigation for the same period by both the Central and State Authorities. 13. To counter the claim of the Petitioner, Mr. Singh has, during the course of the hearing, screen-shared the recent notice issued by the State Authorities dated 16th November, 2020, which was not brought to our notice by the Petitioner. This notice is evidently making a requisition for documents pertaining to 2020-21. The said letter reads as under:- OFFICE OF THE ASSISTANT COMMISSIONER, (KCS WARD-201) GOVT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f ₹ 6 lakhs. 3. The Enforcement Team has intimated in its report that as per the list provided by the firm/company on the date of visit an amount of ₹ 55,90,897/- was pending for payments in contravention of Section 37 of GST Rules which attract ITC reversal along with penal Interest. 4. The Enforcement Team has intimated in its report that as per the stock submission receipt dated 14/11/2017 available on DVAT portal for the stock details as on 30/06/2017, the stock declared was amounting to ₹ 21,40,99,505/- whereas the stock details furnished in form TRAN-I is ₹ 16,95,31,736/-. Hence, the difference in stock of ₹ 4,45,67,769/- . 5. The Enforcement team has intimated in its report that there is a difference between tax liability declared in GSTR 3b and ITC available in GSTR 2A and the same was not discharged by payment of tax. An explanation was called for in this regard but no reply/explanation has been received till the date of submission of report. 6. The Enforcement Team has intimated in its report that the dealer has undertaken in writing to submit the following information/documents with its clarification in the office but the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... may be preceding the period under investigation, cannot also lead to the conclusion that period to which the documents pertain is already under investigation. Further, we may note that, since the investigation is presently underway, so we need not delve deeper on this issue. We can also observe that in the event the notice issued by the DGST authorities pertains to a period which is covered by the investigation carried out by the Central GST authorities, the Petitioner can take recourse to the appropriate remedies in that regard. 15. Since contentions have been raised with respect to the cross-empowerment of the Central and the State authorities, and it is asserted that there are no guidelines prescribed under the Act or the Rules, it would be profitable to throw some light on the issue. In this context, the letter issued by the Central Board of Indirect Taxes and Customs dated 5th October, 2018 which also finds mentions in the order of the Gujarat High Court in R/Special Civil Application No. 23279 of 2019 dated 27th December, 2019 titled Sureshbhai Gadhecha v. State of Gujarat, relied upon by the Petitioner, reads as under: LETTER D.O.F. NO. CBEC/20/43/01/2017-GST(FT ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as follows- F. No. CBEC-20/10/07/2019-GST Government of India Ministry of Finance Department of Revenue Central Board of Indirect Taxes Customs GST Policy Wing *** Dated: 22nd June, 2020 The Principal Director General, Directorate General of GST Intelligence, 2nd Floor. Wing- VI, West Block- VIII R.K. Puram, New Delhi- 110066 Sir, Subject: Reference form DGGI on Cross empowerment under GST. reg. I am directed to refer to DGGI letter F.No.574/CE/66/2020/Inv./15308 dated 26.05.2020 on the issues related to cross empowerment of officers in terms of provisions of section 6 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the CGST Act ). 2. Issue raised in the reference is whether intelligence based enforcement actions initiated by the Central Tax officers against those taxpayers which are assigned to the State Tax administration gets covered under section 6(1) of the CGST Act and the corresponding provisions of the SGST/UTGST Acts or whether a specific notification is required to be issued for cross empowerment on the same lines as notification No. 39/2017-CT dated 13.10.2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... powerment under section 6(1) of the CGST Act is absolute and not conditional. 16. It is thus apparent that if an officer of the Central GST initiates intelligence- based enforcement action against a taxpayer administratively assigned to State GST, the officers of the former would not transfer the said case to their counterparts in the latter department and they would themselves take the case to its logical conclusion. At this stage, we are only concerned with the search action initiated and the ultimate logical conclusion would have to be gone into at the appropriate stage, when the Revenue proceeds for determination of tax. The Respondents would be bound by the aforenoted circulars and we reiterate that in case the action of the State and Central Authorities is overlapping, the Petitioner would be at liberty to take action to impugn the same in accordance with law. 17. As regards the absence of the two independent witnesses, we may first note that there is no panchnama on record. In essence, the main thrust of Petitioner s argument is that the statement of Mr. Rajeev Gupta does not record the presence of the two independent witnesses or signatures, making the search action ..... X X X X Extracts X X X X X X X X Extracts X X X X
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