Section 63 of GST - Assessment of unregistered persons. Check Details for GST Section 63 In this section you may find all details for "Assessment of unregistered persons" as per GST Act 2017. Detailed Analysis of GST Section 63 of GST Act 2017.Must Read – List of all sections of GST
Section 63 of GST - Assessment of unregistered persons
|Section or Rule||Description|
|Section 2(11)||Definition of Assessment|
|Section 22||Person liable for Registration|
|Section 24||Compulsory Registration|
|Section 29||Cancellation of Registration|
|Section 44||Annual return|
|Section 73||Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised for any reason other than fraud or any wilful-misstatement or suppression of facts.|
|Section 74||Determination of tax not paid or short paid or erroneously refunded or input tax credit wrongly availed or utilised by reason of fraud or any wilfull-misstatement or suppression of facts.|
|Rule 100||Assessment in certain cases|
Analysis of this sectionIntroduction
- (a) A person who contravenes the provisions of this Act or Rules made thereunder; or
- (b) A composition person who fails to furnish returns for 3 consecutive tax periods; or
- (c) A person other than composition person who fails to furnish returns for 6 consecutive months or
- (d) A person who has sought voluntary registration but has failed to commence business within 6 months; or
- (e) Where registration has been obtained by way of fraud, willful misstatement or suppression of facts.
- Taxable person – is the one in respect of whom this procedure may be adopted. As a result, all ingredients to establish a person to constitute ‘taxable person’ as per section 2(107) must be satisfied. In the absence of SCN, Proper Officer appears to come under great scrutiny for invoking this jurisdiction. All aspects that the Proper Officer admitted at the time of invoking these provisions will need to stand scrutiny. But that would be the proceedings by way of response to the notice granting opportunity under section 63 (not section 73 or 74) or in further appellate proceedings;
- Fails to obtain registration – is a positive act on the part of such taxable person. ‘Fail’ is not the same as ‘omits’ to obtain registration. Clearly, being conscious of the requirement to obtain registration will be required and as such come in for examination. While no ‘intent’ needs to be established for such failure but clearly it cannot be supported merely on account of an inference about taxability or bona fide view on nontaxability of a transaction or judicial interpretation; or
- Registration cancelled but liable to pay tax – here, reference is provided to cancellation under section 29(2). The entire section 29(2) is where ‘cancellation’ is done by Proper Officer. It is not taxable person’s responsibility if Proper Officers decides to cancel registration (in the five circumstances listed) and then proceeds to invoke jurisdiction under section 63 to pass a best judgement order. It is a wonder that on one hand Proper Officer will cancel registration under section 29(2) and then proceed to fasten a demand on taxable person by an assessment order under section 63 without issuing an SCN. Experts view that the use of this section will come in for severe judicial scrutiny for failure to retain the registration and issue SCN on all grounds that would afford taxable person to not only defend on continuance of registration but also suspected tax liabilities. It would be appropriate that Proper Officer ‘suspend’ registration under rule 21-A (2) instead of cancelling the registration.
- command public authority to (i) do what it ought to do or (ii) abstain from doing what it is attempting to do;
- censure public authority carrying role of administrative tribunal (i) not to steer from vested jurisdiction (ii) deviate from following natural justice (iii) supervise and oversee discharge of that role and (iv) avoid manifest error in law or procedure;
- prohibit proceedings before public authority that are not yet concluded that would result in illegality (any of four causes types listed earlier) if the said proceedings were permitted to continue;
- question ‘authority’ of the public authority right at the threshold when any proceedings are commenced.