GST Implementation Report
GST Commissionerates – Proposed Organizational Structure
SEARCHES/Seizure: Both the Central and State Governments should be authorized to issue search warrants separately under CGST/IGST or SGST laws, as the case may be. For this purpose, the legal provisions under the CrPC as made applicable to the Central Excise Act, 1944 may be replicated with suitable modifications. For GST/IGST, search warrants may be issued by officers of the rank of Joint/Additional Commissioner or the Commissioner. The authority carrying out searches should inform the other tax authority immediately to enable it to join the operations, if necessary. The goods and documents, however, should be seized by the authority, which issues the search warrant.
A tax payer has to face the searches from multiple agencies like the AE Commissionerates, regular Commissionerates, and specialised agencies of State and Central Governments. So the power to search should be vested only with the Anti-Evasion Commissionerates/ Divisions. Regular Commissionerates should not have the power to search.
Adjudication and Appeal: The Group recommends two alternate models of dispute resolution under GST, analyzing the pros and cons of both, for consideration of the Board:
In Model 1 there will be separate adjudication process by the CGST and SGST authorities and the integration takes place from the stage of Appeals. In Model 2, the integration takes place from the Adjudication stage itself with separate Adjudicators who will not be under the administrative control of the CGST and SGST authorities.
Experience suggest that it is not easy for somebody who is transferred from Customs to Central Excise or vice versa do handle the work of the other department. So, the model of a Common Adjudicator for both CGST and SGST may not give the desired result, at least in the beginning of the implementation of GST, though the disputes / provisions of law may be similar for CGST/SGST. At the same time the suggestion of separate Adjudicators without the administrative control of the GST authorities is a welcome step. Therefore with integration of both these models, Model 3 can be evolved.
Under this third Model, Adjudication process will be separate for CGST and SGST with separate Adjudicators drawn from CGST and SGST authorities. They will function independently without the administrative control of the CGST/SGST authorities. The integration will take place from the Tribunal Stage (on appeal against the order-in-original). However, because of the integration of the CGST/SGST disputes, the Tribunals will be choked with appeals from both the departments. So each State should have more than one Tribunal with the option to the tax payer to file appeal at any of the Tribunals within the State.