Page 22 - Banking Finance July 2022

LEGAL UPDATE

Legal

GST officials can't force re- It added that in case, any complaint is the revenue department discussed
received from a taxpayer regarding use measures and the road map in line
covery during searches
of force or coercion by any of their of- with its vision 2047.
Tax authorities will now face action if ficers for getting the amount deposited
Which are being prepared following
a taxpayer makes voluntary payment during search or inspection or investi-
the annual conference attended by
of tax during a search. In a move gation, it has to be enquired at the
officials of the finance ministry and
aimed at curbing instances of use of earliest.
Central Board of Direct Taxes, and se-
force or coercion, the Central Board of
As per the law no recovery can be nior revenue officers.
Indirect Taxes and Customs (CBIC) has
made unless the amount becomes pay- At present, APA deals with transfer-
directed its field formations that recov-
able in pursuance of an order passed pricing cases that determine tax liabili-
ery of tax dues should be made follow-
by the adjudicating authority. ties in advance to avoid any dispute.
ing the due legal process after issuance
The DRP is an alternative mechanism
of adjudication order and not during
Ruling authority for direct that deals mainly with international
searches.
taxation cases.
tax cases on cards
The move comes in the backdrop of
Experts say various Authorities for Ad-
complaints of use of force and coercion The revenue department is considering
vance Ruling (AARs) take up issues from
by tax authorities for making 'recovery' the setting up of a ruling authority like
a technical standpoint and do not
during the course of search or inspec- the Advance Pricing Agreement (APA)
cover wider matters of income tax.
tion. or Dispute Resolution Panel (DRP) to
Also AAR decisions have not helped in
ascertain tax liabilities and settle tax
"In case of any wrongdoing on the part containing litigation because most of
disputes. This will allow the Income-
of any tax officers, strict disciplinary the matters go for appeal.
Tax Department and taxpayers to sit
action as per law may be taken against
"Such a process of optional and non-
together and resolve disputes, and
the defaulting officers," the CBIC said
binding mediation can be helpful in
agree on the tax to be paid.
in an internal department note ad-
eliminating tax disputes, particularly
dressed to principal commissioners/ The direct tax claims locked in litiga-
those relating to transfer pricing and
commissioners of Central GST (all tion are about Rs 5 trillion. The concept other matters as well," said Akhilesh
zones), the commissioner, GST Investi- is part of the minutes of the meeting Ranjan, advisor on tax policy at PwC
gation, issued late evening on May 25. circulated internally last month, when and former member of the CBDT.

22 | 2022 | JULY | BANKING FINANCE