GST officials can’t force recovery during searches

Tax authorities will now face action if a taxpayer makes voluntary payment of tax during a search. In a move aimed at curbing instances of use of force or coercion, the Central Board of Indirect Taxes and Customs (CBIC) has directed its field formations that recovery of tax dues should be made following the due legal process after issuance of adjudication order and not during searches.

The move comes in the backdrop of complaints of use of force and coercion by tax authorities for making ‘recovery’ during the course of search or inspection.

“In case of any wrongdoing on the part of any tax officers, strict disciplinary action as per law may be taken against the defaulting officers,” the CBIC said in an internal department note addressed to principal commissioners/commissioners of Central GST (all zones), the commissioner, GST Investigation, issued late evening on May 25.

It added that in case, any complaint is received from a taxpayer regarding use of force or coercion by any of their officers for getting the amount deposited during search or inspection or investigation, it has to be enquired at the earliest.

As per the law no recovery can be made unless the amount becomes payable in pursuance of an order passed by the adjudicating authority.