the essay of 19 February 2025 · the untouched capture
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<!DOCTYPE HTML PUBLIC "-//W3C//DTD HTML 4.01 Transitional//EN" "http://www.w3.org/TR/html4/loose.dtd"> <html> <head> <title>Untitled Document</title> <meta http-equiv="Content-Type" content="text/html; charset=iso-8859-1"> </head> <body bgcolor="#FFFFFF"> <p align="left"><font color="#663399" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>FEBRUARY 19, 2025</strong></font></p> <p align="center"><font color="#FF6633" size="2" face="Verdana, Arial, Helvetica, sans-serif"><strong>NO GST Registration because you are from another State! </strong></font></p> <p align="center"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><u>By Vijay Kumar</u></font></strong></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif"><STRONG>STRANGE</STRONG> are the ways of GST officers; they wield their stamp like wizards casting spells, often conjuring confusion with a flick of their pens! One minute, they're welcoming you into the world of taxation, and the next, they've shut the door because you're from ‘not around here.' It's like navigating a bureaucratic labyrinth where logic takes a backseat and the quirks of compliance reign supreme. Who knew that applying for a GST registration could feel more like trying to decode an ancient scroll than simply starting a business? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Are you required to belong to or reside in the State where you want a GST Registration? At least one GST officer in Andhra Pradesh thinks so. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">A prospective taxpayer applied for a GST registration for his premises in Rajamahendravaram in Andhra Pradesh. When somebody applies for a registration, it means that he is likely to do business and pay GST facing all the hurdles placed before him by the benign bureaucrats. If the Department has any interest in really collecting taxes, they should go the applicant with a bouquet and welcome him into the fold of the exciting good and simple tax. Unless he comes in, how can you harass him? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But here is an Assistant Commissioner who rejected the registration on the grounds that: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. The applicant does not belong to Andhra Pradesh. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. Even his authorized representative does not belong to the State of Andhra Pradesh. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How can you think of starting a business in a State you don't belong to? Atrocious! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">It is not laid down in any law that to get GST registration, you should belong to the State where you are seeking registration or that at least your authorized representative should belong to that State. On the contrary, "Article 19 of the Constitution of India, grants every citizen of this Country, the right to set up and do business <em>"anywhere in the country." </em></font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">But the Constitution and the GST laws are beyond the learned Assistant Commissioner who obviously is a law unto himself. The Chief Minister of his State is going round the world with presentations inviting businessmen to come to his State to do business, promising all help. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In a tweet in X, he declared,</font></p> <p align="center"><img src="http://taxindiaonline.com/RC2/image/stories/je182251.JPG" width="745" height="618"></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And here is an Assistant Commissioner who says, "No registration, because you don't belong to this State." What about the Chief Minister's invitation? That is not a notification! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Our prospective taxpayer had a divine name – ‘Tirumala Balaji Marbles and Granites'; of course, that didn't influence our Assistant Commissioner into giving them a registration. Tirumala Balaji resides in Andhra Pradesh and in the devout minds of millions of people. Even He is a GST assessee and His temple is managed by a Trust which has members from all over India. On 3 rd February 2025, the Minister of State in the Ministry of Finance, Pankaj Chaudhary told the Lok Sabha that in 2024-25 (up to 31st December, 2024), the Tirumala Trust paid a GST of Rs. 36.28 Crores. Obviously, He had no problems in getting a GST registration. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Anyway, our ‘Tirumala Balaji Marbles and Granites' could not satisfy the Assistant Commissioner about its eligibility to get a GST registration and so, was denied one on the ground of not belonging to the State of Andhra Pradesh. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">What can you do when an Assistant Commissioner blatantly, in disregard to the Constitution and the GST Act, refuses to register a prospective taxpayer? </font></p> <p align="justify"><font color="#006600" size="2" face="Verdana, Arial, Helvetica, sans-serif">Fortunately, there are High Courts. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And so, Tirumala Balaji Marbles approached the Andhra Pradesh High Court in writ petition. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In the High Court, the State submitted that the registration was rejected on the ground that there <em>would be any amount of scope for tax evasion, as none of the responsible persons are from the State of Andhra Pradesh </em>. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">The High Court [<strong><a href="https://taxindiaonline.com/RC2/caseLawDet.php?QoPmnXyZ=MTgwMzE0" target="_blank">2025-TIOL-293-HC-AP-GST</a></strong>] observed, </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">1. Though the apprehension of the respondents may not be misplaced, it would not mean that registration can be refused on a ground, which is not available under the Statute or the Rules. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">2. There do not appear to be any restriction for persons outside the State to come into the State of Andhra Pradesh and seek registration under the APGST Act. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">3. Mere apprehension, however well founded, cannot deprive the petitioner of his right to carry on trade and business in the State of Andhra Pradesh. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">4. It is also necessary to notice that Article 19 of the Constitution of India, grants every citizen of this Country, the right to set up and do business anywhere in the country. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">5. In such circumstances, the order of rejection is clearly without any basis in law. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Accordingly, the writ petition was allowed and the order of rejection dated 04.11.2024 was set aside. The respondents were directed to register the petitioner. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Let's break down the Assistant Commissioner's logic: </font></p> <blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you eat cake, you might get crumbs on your shirt; so, to avoid embarrassment, just don't eat cake at all. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you own a pet dog, it might bark and disturb your neighbours; so just adopt a pet rock instead. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you start exercising, you might get sore muscles; so, it's better to just stay on the couch and watch fitness videos. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you have a garden, pests might invade and ruin your plants; so why not just cover it all with concrete? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you invite friends over, they might eat all your snacks; so why not just throw a party with no food at all? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you have a bank account, there could be cyber thefts – so, don't have a bank account – keep cash at home. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you have cash at home – thieves may break in; so, don't keep cash at home - better still, don't have cash at all. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">If you provide GST registration, there's a risk of tax evasion; so, avoid the hassle altogether. </font></p> </blockquote> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Does the Assistant Commissioner believe that granting registration is a favour to the taxpayer? Registration is not a favour; it's a statutory requirement – if at all it is a favour, it is a favour to the department, not the assessee. Are you not working against the government which pays you rather well by refusing registration and thereby taxes? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">And is there any guarantee that an assessee from the same State will not evade? And what if he evades and runs off to another State? Is the Assistant Commissioner protecting the interests of the State or jeopardising it? Will he cancel the registration of all the already registered taxpayers in his jurisdiction if they are from outside the State? The Chief Minister is inviting <em>respected </em>investors to start business in his State and an Assistant Commissioner does not want to give registration just because the applicant is from another State. What will the respected Assistant Commissioner do if he is from another country? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">How unfortunate it is that the State has the audacity to tell a High Court that registration cannot be given apprehending evasion in spite of constitutional protection! </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">To start an enterprise the trader has to organise several services and permissions like land, building, electricity, water, pollution and what will happen to him after all these, he is told that he cannot run his business because he belongs to another State? And he has to approach the High Court to get a simple registration for the good and simple tax? The first step in this mega maze is registration and for that you have to go to the High Court! Is a High Court meant for trivialities like granting GST registration? </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Can the government stop recruiting officers on the apprehension that new recruits may become corrupt and would be a threat to revenue? When will the officers realise that the trade does not exist only to pay GST – rather you get GST because they exist. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">In his zealous quest to protect revenue by rejecting registrations, the Assistant Commissioner has ironically threatened the very cause he seeks to uphold, undermining both the GST Law and the Constitution's fundamental principles. </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">These are the days of MAGA + MIGA = MEGA </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Could it be </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MAGA - Make Accountability Great Again </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MIGA - Make Investors Giggle Again </font></p> <p align="justify"><font size="2" face="Verdana, Arial, Helvetica, sans-serif">MEGA - Make Everyone's Goals Achievable </font></p> <p align="justify"><font color="#FF0000" size="2" face="Verdana, Arial, Helvetica, sans-serif">Until next week </font></p> <p align="justify"><strong><font size="2" face="Verdana, Arial, Helvetica, sans-serif">Comments/feedback welcome at <a href="mailto:vijaywrite@tiol.in" target="_blank">vijaywrite@tiol.in </a> or 9848111243 (WhatsApp) </font></strong></p> </body> </html>