Service Tax – Access to Registered Premises – Only Superintendents and above authorised - CBEC Clarifies
Rule 5A was inserted in the Service Tax Rules, 1994, vide Notification No.45/2007-ST dated 28.12.2007. Board had also issued instructions vide F.No.137/26/2007-CX.4 dated 01.01.2008 in this regard.[see - 01.01.2008 and TIOL-DDT 802 - 12.02.2008]. The service tax rules were amended to allow the officers to access the registered premises of the taxpayer for carrying out scrutiny, verification and checks as necessary to safeguard the government revenue. The rule 5A envisages that Commissioners are required to duly authorize the officers before such access.
While reporting this in DDT 802, it was mentioned,
Board clarifies that this rule does not envisage issue of any notification by a Commissioner for such authorisation of officers. The requirement of authorisation could be fulfilled by issue of an office order. How will the assessee know that the officer wanting to have access to the premises is authorised by the Commissioner? Can he ask for the authorisation?
Board has now noted,
Instances have come to the notice that some of the Commissionerates have issued Trade Notices, authorizing all the officers of rank of Inspectors and above, posted in the Commissionerate, to visit the taxpayers. It was never the intention of the said amendment to allow unrestricted access to the premises of the taxpayer by the officers. Issuance of such Trade Notices giving unfettered power to all the officers to visit taxpayers is against the spirit of the amendment in particular and policy of the Government in general. While it is not necessary that Commissioners should authorize individual visits to taxpayer and a general authorization can be granted, however, for each visit to the premises of the taxpayer, permission must be given in writing by an officer not below the rank of Assistant/Deputy Commissioner.
So, Board has now decided that:-
1. Henceforth officers above the rank of Inspectors should be allowed access to the premises of tax payers in terms of Rule 5A of the Service Tax Rules, only after they are duly authorized in writing, in each case, by an officer not below the rank of concerned Assistant/Deputy Commissioner. [Who is this concerned AC/DC?]
2. To facilitate such authorization/permission, the same can be given through a register maintained for the purpose.
3. Such register should be reviewed and signed at the end of each month by the concerned Joint/Additional Commissioner and once in every quarter by the concerned Commissioner.
4. This instruction would ipso facto apply to formations carrying out investigation functions.
5. All instructions/clarifications/trade notices contrary to the aforesaid instructions stand cancelled/withdrawn.
But even now, how will an assessee know that the officers visiting him are authorized to do so? Can’t it be made mandatory for the officers to give a letter to the assessee that they have visited his premises?
Should the JC/ADC/Commissioner also take authorization from the concerned AC/DC?
Again keeping its recent practice of keeping important instructions under cover, the Board has sent this as a letter to the field and not as a public circular. It’s really a mystery why the Board wants to keep its good work under wraps!
CBEC F.No.137/26/2007-CX.4 Dated: 15th December, 2008.