GST is implemented in India for efficient tax collection, for easy inter-state movement of goods and to reduce the corruption. Under GST there are strict provisions to inspect and search places of business for suspected tax evaders.
An inspection is an act that enables the officer to access any place of business of the taxable person. It also enables the officer to access any place of business of an individual who is engaged in transporting goods or the individual who is the owner or operator of a warehouse or go down. In real it is a softer provision than search. Inspection can only be carried out by the officer of Central Goods and Service tax (CGST) or State Goods and Service Tax (SGST) upon a written authorization given by an officer of the rank of Joint Commissioner and above.
An officer higher in rank or Joint Commissioner can give such authorization only if he/she believes that person who is concerned has performed any of the following actions:
Inspection is done for the conveyance and for the consignment whose value exceeds the limit which is already specified. The individual who oversees the conveyance must maintain documents or devices for verification and should allow inspection. Inspection during transit of goods can be done even without the authorization of the Joint Commissioner.
Search is an attempt to find something. It is an action taken by the government official to go and carefully examine a place, person, object etc. it can be done under a proper and valid authority of law. The term “Seizure” has not been specifically defined under GST law. However, Seizure is an act of taking over something or someone by legal process. It simply means taking over the possession forcibly against the wish of the owner. The provisions of the Code of Criminal Procedure apply to search and seizure.
As per GST law, searching for any place of business can be carried out only under the authorization from an officer who is not below the rank of Joint Commissioner and that concerned business owner has committed any of the following:
The commissioner of Central Goods and Service Tax (CGST) or State Goods and Service Tax (SGST) or an authorized officer can purchase any goods or services from a taxable person to check the issue of tax invoices whether they are maintained correctly and whether the GST has been clearly displayed. The amount will have to be refunded by the taxable person and sales invoice will be canceled when the goods will be returned.
Detention means taking access of the goods seized without any legal order or notice. In such case, the ownership still lies with the real owner, unless it has been legally proved. It is generally issued when it is suspected that the goods are liable to confiscation.
Whereas, Seizure is taking away the possession forcibly against the wish of the owner, though with legal force.
If a person commits any offense under Section 132, then he or she can be arrested by any Central Goods and Service Tax (CGST) or State Goods and Service Tax (SGST) officer. GST provides inbuilt safeguards for arrests in ensuring that the arrests are only made under the strict authority of the commissioner.
The salient points of this provisions are as follows: