GST paying Traders under FTCCI, Telangana in Dismay after Govt issues Direction to Revise Orders by Re-opening Already Closed Proceedings

The commercial tax department’s internal note, circulated to joint commissioners across divisions in the state, has caused concern among GST-paying traders associated with FTCCI (Federation of Telangana Chambers of Commerce and Industry). This note, issued under section 108 of the Telangana GST Act, 2017, diverges from the GST Council’s directive to avoid imposing undue hardships on businesses and simplify compliance procedures. The note instructs joint commissioners to review orders from previous financial years by reopening closed proceedings and recommends taking disciplinary action against officials responsible for irregular orders resulting in revenue loss. CA Mohd. Irshad Ahmed, chairman of the GST and Customs Committee at FTCCI, expressed apprehension about the potential impact on tax officers’ decision-making if disciplinary actions become commonplace.

He highlighted the challenges faced by officials in making decisions based on thorough verification of taxpayer records and emphasized the absence of provisions in GST law for penalizing officials for genuine errors. He also urged the Commercial Tax Department to consider the repercussions on trade and industry, particularly small and medium enterprises, before reopening concluded proceedings. The industry has long advocated for an amnesty scheme, especially for small and medium enterprises, concerning tax demands for the initial two years of GST implementation (FYs 2017-18 and 2018-19). This matter could be raised before the GST council. Recently, the Central Board of Indirect Taxes and Customs ( CBIC ) cautioned officers against hasty issuance of show cause notices under GST, as it could lead to legal disputes. CBIC has issued clarifications and provided relief to taxpayers on procedural aspects, aiming to minimize litigations.

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