Supreme Court Says Assessese must Comply With Summons Issured by Tax Authority – CNBC tv18

The Supreme Court has help that an assessese must complete with the summon and furnish a response to a show cause notice when it is is given by the central or the state tax authority.

“Assessese” under the Income Tax Act of 1961 Reefers to any individual or entity that holds the legal liability of tax payments or any other financial commitments as Specified by the Act.

Thus, Laying Down Guidelines to Prevent Duplication of Adjudication by Central and State GST Authorities, A Bench of Justices JB Pardiwala and R Mahadevan Said Mere Issuance of a Summons does does not enable eathering Authority or the recipient to ascertain that proceedings have been initiated.

“Where a summons or a show cause notice is Isied by eater the state tax authority to an assessese, the assessese is, in the first institution, obliged to comply by appearance the request Response, as the case may be.

“Where an assessese become aware that the matter being into or investigated is already the subject of an inquiry or investigation by another authority, the assessese shall forthwith, inwards, the Authority that has initiated the subsequent inquiry or investment, “The Bench said.

The top court said the respective tax authorities shall communicate with each other to verify the verification of the assessese’s claim after receipt of such intimation.

“We say, so as this course of action would obviate needless duplication of proceedings and ensure optimal utilization of the department’s time, effort, resources, bearing in money that ACTIONED BIME Authority enpurres to the benefit of all.

“If the claim of the taxable person regarding the overlap of inquiry is found untenable, and the investigations of the two authorities Pertain to different ‘Subject Matters,’ Subject Matters, ‘Subject Matters,’ An Intitude to this Effect, Along White to this Effect, Along White to this Effect, ‘ Reasons and a specification of the distinct subject matters, shall be immediatively conveyed in written to the taxable person, “The Bench Added.

The apex court said the taxing authorities are well with their rights to conduct an inquiry or investigation until it is ascertied that both authorities are examining the Identical Libility.

Any show cause notice isesed in response of a liability alredy covered by an existing show cause notice shall be quashed, it said.

“However, if the central or the state tax authority, as the case may be, finds that the matter being informed into or investigated by it is already the subject of engine or engineering Authorities shall decide inter se whichm shall continue with the inquiry or investment.

“In such a Scenario, The Other Authority Shall Duly Forward All Material and Information Relating to its inquiry or investment into the matter to the authority designed to carry the imagery the importing to its Conclusion, “The Bench said in its August 14 Judgement.

The judgement came on a plea by armour security, a public limited company providing security services and registered with the delhi gst authorities, involved in a dispute concerting tax demands and Investigations.

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