The Supreme Court, while setting guidelines on behalf of the Central and State GST authorities, has said that the taxpayer will have to comply with summons and reply to the show cause notice issued by the Central or State Tax Authority.
Under the Income Tax Act 1961, ‘taxpayer’ refers to any person or institution, who has a legal responsibility for the tax specified by the Act or any other financial commitments. A bench of Justice JB Pardiwala and Justice R. Mahadevan said that only by issuing summons, the issuing authority or recipient is not able to ensure that the proceedings have started.
Authority issued summons or show cause notice
The bench said, “Where a taxpayer is issued summons or show cause notice by the Central or State Tax Authority, the taxpayer, prima facie, present and presented the expected response is obliged to comply with, no matter what the matter is.”
The bench said, “Where a taxpayer comes to know that the matter which is being investigated or investigated is already a matter of investigation or investigation on behalf of another authority, then the taxpayer will have to inform the authority in writing immediately to the authority who has later started investigation or investigation.”
Tax officials full right to investigate or investigate
The Supreme Court said that after receiving such information, the concerned tax officials will communicate with each other to confirm the truth of the taxpayer’s claim. The court said that tax authorities have full right to investigate or investigate, until it is ensured that both the officers are investigating the same responsibility.
The bench said, “However, if the Central or State Tax Authority, as the case is possible, the matter which is being investigated or investigated is already a matter of investigation or investigation by another authority, then both the authority will decide among themselves which of them will continue to investigate or investigate.”
Court’s decision regarding ‘Armor Security’ petition
The bench said in its judgment of August 14, “In such a situation the other authority will duly send all the material and information related to the investigation or investigation to the authority who is nominated to take the investigation or exploration to its logical conclusion.”
This decision of the court has come on the petition of ‘Armor Security’. It is a public limited company that provides security services and is registered with the Delhi GST Authority. This company is involved in a dispute related to tax demands and investigation.
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