There is no cross empowerment of officials of State GST (SGST) and Central GST (CGST) to inspect, search, detain or seize of goods, said city-based indirect taxes expert Monish Bhalla. These raids were conducted over the past 2-3 months.
He claimed that empowerment is only for the purpose of granting of refunds, and there is no notification for cross empowerment for inspection, detention, seizure and search operations.
The concept of cross empowerment of officials of CGST and SGST was brought in to ensure the refunds so that businessmen do not face the problem of liquidity shortage. Here a single officer, of either CGST or SGST, can order the refunds for CGST and SGST. However, the authority is also being extended to raids and related operations, claimed Bhalla.
This would mean that CGST officials can conduct raids on cases related to SGST and vice versa.
"There was notification granting cross empowerment for refunds.
But, there is no notification for cross empowerment for inspection, detention, seizure and search operations. Such operations have been carried out in past 2-3 months.
If someone challenges these operations in the high court, the court will reprimand the officials," Bhalla told DNA.
While there was broad agreement on cross empowerment under CGST and SGST Acts, there was disagreement on cross empowerment under IGST Act in relation to the Place of Supply Rules.
"However, there was an urgency to cross empower officials to clear refunds. While the notifications for cross empowerment for refunds were published, the draft notifications for other purpose were deferred," said Bhalla.
