In a recent development, the Government of India, Ministry of Finance, Department of Revenue, Central Board of Indirect Taxes and Customs, GST Policy Wing, issued Instruction No. 04/2023-GST on the 23rd of November 2023. This directive, marked with F.No.20016/41/2023-CBIC, carries significant implications for businesses and taxpayers under the purview of the Goods and Services Tax (GST) regime.
Understanding the Instruction:
The instruction primarily focuses on the electronic serving of notices and the uploading of order summaries on the GST portal. Addressed to all Principal Chief Commissioners, Chief Commissioners, Principal Commissioners, and Commissioners of Central Tax, as well as Principal Directors General and Directors General of Central Tax, this communication aims to streamline and enhance the efficiency of GST-related processes.
Legal Framework:
To comprehend the essence of Instruction No. 04/2023-GST, we must refer to the relevant sections of the Central Goods and Service Tax Act, 2017 (CGST Act). Sections 52, 73, 74, 122, 123, 124, 125, 127, 129, and 130 outline the circumstances under which a notice must be issued by the proper officer. These scenarios include the demand and recovery of unpaid taxes, rectification of wrongly availed input tax credits, and correction of erroneously claimed refunds. Additionally, attention is drawn to sub-rule (1) of rule 142 of the Central Goods and Service Tax Rules, 2017 (CGST Rules), which mandates the electronic service of a summary of such notices on the portal in FORM GST DRC-01.
Electronic Upload of Order Summaries:
Furthermore, when an order is issued by the proper officer under various sections of the CGST Act, a summary of this order must be uploaded electronically on the portal in FORM GST DRC-07. This summary should explicitly state the amount of tax, interest, and penalty, if applicable, payable by the concerned person.
Addressing Operational Challenges:
The instruction sheds light on a concerning issue – the manual issuance of notices and orders by some field formations. It has come to the notice of the Board that summaries of notices issued under specific sections of the CGST Act are not being electronically served on the portal in FORM GST DRC-01. Similarly, summaries of orders issued under various sections are not being uploaded electronically in FORM GST DRC-07. This non-compliance is a clear violation of the explicit provisions of the CGST Rules.
The Significance of Electronic Serving and Uploading:
The importance of adhering to the electronic serving and uploading requirements cannot be overstated. Not only does it ensure that notices and orders are available electronically to taxpayers on the portal, but it also facilitates the tracking of proceedings and consequential actions related to recovery, appeals, and more. Any deviation from these requirements may adversely impact record-keeping under GST, potentially affecting further proceedings of appeal and recovery.
Directives to Proper Officers:
To address these issues, proper officers are directed to ensure the electronic service of summaries of notices issued under specific sections of the CGST Act in FORM GST DRC-01. Additionally, they must guarantee the electronic upload of summaries of orders issued under various sections in FORM GST DRC-07.
Supervision and Compliance:
The responsibility extends to the Principal Chief Commissioners and Chief Commissioners of the CGST Zones and the Principal Director General of DGGI. They are expected to closely supervise the officers within their jurisdictions to ensure strict compliance with the provisions of rule 142 of the CGST Rules.
Conclusion:
In conclusion, businesses and taxpayers operating under the GST regime must promptly align their practices with the directives outlined in Instruction No. 04/2023-GST. These measures aim to enhance the efficiency, transparency, and accountability of GST-related processes, ultimately contributing to the smoother functioning of the GST framework.
