Goods and Service Tax – GST – By: – Pradeep Jain – Dated:- 21-8-2010 Last Replied Date:- 30-12-1899 – Introduction: Too many cooks spoil the broth perhaps this would have been in the thoughts of Group on Implementation of GST while analyzing the organizational structure for GST. This group is a committee constituted by the Government that has been framed to analyze all the aspects which will be affected by implementation of GST. On 12.07.2010, the Group has given their report. In this article, we are discussing the administrative changes proposed by the Group under GST regime. * Organizational Structure proposed under GST: – The Group has recommended that the organizational structure under the GST regime should be on functional basis rather than on territorial jurisdiction basis. The present organizational structure is based on territorial jurisdiction and one office i.e. Range handles all the different functions pertaining to units falling under their jurisdiction. Thus, one office h
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ere units are located at one place. In the case of Multi Locational units (MLU) belonging to same assessee is co-ordinated by the office of ADG (Audit). Proposal for GST:- Looking to the success and achievements of DGCEI, it is being accepted that an entity entrusted with a specialized function snatch a better result. As such, it is proposed that separate and exclusive Commissionerates should be set up for audit and anti-evasion work. For the taxpayers having Multi-locational units (MLU) in a state, for high revenue-paying units and for some of the complex business sectors, it is recommended that the Audit must be conducted by Audit Commissionerates. And for other assessees, it is proposed that the jurisdictional GST Commissionerates should do the Audit work. Within the Audit Commissionerates, it is proposed that there should be specialized Cells for specific industry or sector. For example, specialized audit groups for banking and financial services in Mumbai, for Mining Industry in C
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cause notice will be issued? To whom they will be replied and the consequences of these notices will be followed up by whom? If the Audit Commissionerate is itself going to accomplish all these tasks, one can presume of a day when the audit Commissionerate will be indulged in routine matters like follow up which in present system is carried on by the officers of lower rank. Anti-Evasion Commissionerates: – Present Scenario: Anti-evasion work is done by three types of teams – (i) Anti-evasion wing of the Commissionerate Headquarters; (ii) Preventive units of the Divisions; and (iii) Directorate General of Central Excise Intelligence (DGCEI). Out of the three, the DGCEI is carrying out the work of intelligence and investigation at national level. It is top-ranked of three as regards quality of cases booked, value of goods and amount of duty involved in offence cases. The reason is being analyzed as this is an independent and specialized entity devoting its 100% in this particular task on
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equired to be centralized at the headquarters. They can be placed at different places within the state which will be as per the administrative requirements. However, whether all the staff will be fit for every location? The Group itself has proposed the establishment of specialized cells for specific industry or sector. Working there for certain time will adversely affect their competency in a different sector. It is also proposed to divide the Commissionerates on functional basis which will also affect the movability of the staff and their services. It will also be limited to that particular function. If they are moved to another sector/department, it will reduce the quality of work. Further, if it is decided to transfer the staff on a frequent basis, it will increase the related costs to government and will reduce the sense of responsibility amongst them. * Supervision of Work: – The Group has recommended that Audit/Anti-evasion work at Commissionerates should be supervised by office
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tate dealers. Thus, it has been provided that a uniform organizational structure for the entire country would not work and different types of organizational structure is required depending upon dispersal/diversity of assessees in an area. The Group has recommended following types of Commissionerates which will have a clearly defined geographical jurisdiction: (a) One-tier functional Commissionerate (b) Two-tier functional Commissionerate (c) Three-tier territorial Commissionerate One-Tier functional Commissionerate: – Characteristics:- · It is proposed for cities having large concentration of assessees. · It will be formed on functional basis. · It will comprise of different divisions wherein specific functions like registration, processing of returns, refund, adjudication, administration, appeal, recovery of arrears etc. will be performed. · Each division may further have sub-divisions. This type of Commissionerate will promote specialization and improve ef
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Division B (Territorial) Division C (Territorial) Division D (Territorial) Division E (Territorial) Registration Refund/ Arrears / Recovery Adjudication /Legal Administration Audit Return Processing Three-tier territorial Commissionerate: – Characteristics:- · It is proposed where the assessees are spread over a large area like in present Central Excise Commissionerates of Belgaum, Meerut-II, Guwahati, etc. · This is designed on the present structure of Commissionerates with Divisions and Ranges based upon the territorial jurisdictions. Commissionerate Division A (Territorial) Division B (Territorial) Division C (Territorial) Division E (Territorial) Division D (Territorial) Range-I
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r the entire State. Thus, one Commissionerate will have the legal backing to conduct checks, verifications, audit and anti-evasion functions of an assessee in the entire state. * Other Recommendations: – The present ACES work on a C-D-R (Commissionerate-Division-Range) mapping. It is proposed to modify the same to suit the new organizational structure. Since the entire proposal of GST is based on online submissions – whether it is registration, return filing or processing of return. As such, modification of the ACES is must for proper implementation of GST. * Number of Commissionerates in GST: – Under GST regime, the Group has proposed that there should be 150 GST Commissionerates, 45 Audit Commissionerates (To audit Customs Post-clearance Audit also) and 20 Anti-evasion Commissionerates. This has been proposed on the estimate that there will be about 35,000 to 50,000 assessees per Commissionerate depending upon the dispersal of the assessees. And it was also felt that the number of ta
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and is assessee under the jurisdiction of specified Income Tax Commissionerates of Bangalore, Chennai Mumbai or Delhi. The LTUs have been given the benefit of transfer of credit from one LTU to another and the removal of goods from one unit to another without payment of duty. A point was raised during the discussion as to whether the LTU should be continued. The Group was satisfied with the encouraging results of LTU functioning at the four places and has proposed that the LTUs should continue at the State level for CGST, SGST and IGST. However, the Group has felt that whether the present benefits or special dispensation given to LTU should be continued is a policy issued and the Board has to decide the same. It has been said in the report that the benefits given to the LTU would not be relevant under GST. Thus, it is required to be decided to continue the LTU concept or not. If the LTU concept is continued then the entire legal provision of giving option to the unit to join LTU is to
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