Assessee is entitled to make copy of seized documents under GST
The term ‘search’, in simple language, denotes an action of a government machinery to go, look through or examine carefully a place, area, person, object etc. in order to find something concealed or for the purpose of discovering evidence of a crime. The search of a person or vehicle or premises etc. can only be done under proper and valid authority of law. ‘Inspection’ is a new provision under the CGST/SGST Act. It is a softer provision than search to enable officers to access any place of business of a taxable person and also any place of business of a person engaged in transporting goods or who is an owner or an operator of a warehouse or godown. Section 67 of the CGST Act pertains to Power of inspection, search and seizure under GST.
Is the taxpayer empowered to make a copy of the seized document under Section 67 (5) under Chapter XIV of GST Act?
The Calcutta High Court in the case of J.S.Pigments Private Ltd. Vs The State of West Bengal & Ors has held that the taxpayer is empowered to make a copy of the seized document under Section 67 (5) under Chapter XIV of the Central Goods and Services Tax Act, 2017.
Petition by the Appellant (J.S.Pigments Private Ltd)
The advocate appearing for the appellant/petitioner submitted that unless the appellant/petitioner is allowed to make copies of the seized documents by the respondent, the appellant/petitioner is not in a position to participate in the proceedings.
Reliance was placed on Section 67 of Central Goods and Services Tax Act, 2017.
1.Section 67 of the GST Act pertains to Power of inspection, search and seizure.
2. According to Section 67(1), where the proper officer, not below the rank of Joint Commissioner, may authorize in writing any other officer of central tax to inspect any places of business of the taxable person or the persons engaged in the business of transporting goods or the owner or the operator of warehouse or godown or any other place if has reasons to believe that:-
a. a taxable person has suppressed any transaction relating to supply of goods, services or both or the stock of goods in hand, has claimed ITC in excess of his entitlement, has indulged in contravention of any of the provisions of this Act or the rules made thereunder to evade tax under this Act
b. any person engaged in the business of transporting goods or an owner or operator of a warehouse or a godown or any other place is keeping goods which have escaped payment of tax or has kept his accounts or goods in such a manner as is likely to cause evasion of tax payable under this Act.
3. According to Section 67(5) the person from whose custody any documents are seized shall be entitled to make copies thereof or take extracts therefrom in the presence of an authorised officer at such place and time as such officer may indicate in this behalf except where making such copies or taking such extracts may, in the opinion of the proper officer, prejudicially affect the investigation.
Contention of the appellant
- The appellant/petitioner had already approached the authority for supplying the certified copy of the seized documents.
- Unfortunately, till date no step had been taken by the authority to supply the same to the petitioner.
- It is reiterated that unless the appellant/petitioner is allowed to make copies of the seized documents, question of attending the proceedings does not arise.
Submissions by Respondent
- Till date no date has been fixed for hearing. Therefore, this appeal along with the applications should be dismissed as premature and there is no urgency to entertain this appeal as well as the applications.
- Respondent submitted that as per law petitioner/appellant can approach before the respondent for making copies of seized documents.
- Unfortunately, no step has been taken by the appellant/petitioner till date to that effect.
- However, the appellant /petitioner without availing, exhausting that provision, straightway filed the writ petition before this Court for allowing the petitioner to make copies of those documents which as per law is not sustainable.
Observations of the High Court
- There is a provision in law that the person from whose custody documents are seized shall be entitled to make copies thereof of the seized documents thereof.
- Unfortunately, till date the appellant/petitioner had failed to avail that opportunity.
- Considering the above discussion High Court was of the considered view there was no ambiguity or illegality or infirmity in the impugned order.
- However, they directed the appellant/petitioner to take steps in terms of Section 67(5) under Chapter XIV of the Central Goods and Services Tax Act, 2017, if he is so advised.
- If the appellant/petitioner takes steps as per Section 67(5), then the respondent was directed to allow the appellant/petitioner to make copies of the seized documents by 13th July, 2020 subject to compliance of statutory formalities.
Thus a taxpayer is empowered to make a copy of the seized document under Section 67 (5) under Chapter XIV of GST Act.