Tag Archives: Central Board of Excise and Customs

IRS officers unhappy with the implementation of GST: CBEC warns those criticising government

Newsroom24x7 Staff

GstNew Delhi: As there has been no dearth of criticism and a vast section of the Indian Revenue Service officers are annoyed and unhappy on the issue of GST, the Central Board of Excise and Customs (CBEC) today wrote to all Principal Chief Commissioners, Chief Commissioners, Directors General Customs and Central Excise drawing their attention to instructions in the past asking all concerned to refrain from commenting adversely on Government and its policies.

CBEC, in its letter today has reiterated that instructions issued earlier by the Board on September 29, 2016 and October 10, 2016 should be followed scrupulously.

All the field formations have been directed by CBEC to ensure that the instructions to refrain from criticising the Central Government and its policies are brought to everyone’s notice. The concerned officers have been told that disciplinary action would be taken under Rule 9 of the Central Services (Conduct) Rules if anyone fails to follow these instructions.

On 29 September 2016, CBEC had issued instructions underscoring Rule 9 of Central Civil Services (Conduct) Rules, 1964 which reads as follows: “No government servant shall in any radio broadcast, telecast through electronic media or any document published in his own name or anonymously, pseudonymously or in the name of any other person or in any communication to the press of any public utterance make any statement of fact or opinion which has the effect of an adverse criticism of any current or recent policy or action of the Central Government or State Government.’

Also read:

Implementation of GST by generalists and private players: Discontent brewing among IRS officers

Implementation of GST: Why involve a Private Limited Company in a Sovereign Function?

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Implementation of GST by generalists and private players: Discontent brewing among IRS officers

Lalit Shastri

The idea of forming a private limited company with private players to implement the GST goes against the whole concept of sovereign responsibility of administering tax administration. It is to be underscored that India is a Union of States and the Union should not become weak by giving the States excessive leverage when it comes to implementing GST. It was weak institutional framework and tax administration that was responsible for the fiscal developments that eventually flared up the Greek crisis..

GstThere is stiff opposition and no dearth of anger among a section of officers belonging to the Indian Revenue Service as the Government of India has put a system in place whereby the GST secretariat will be headed by generalists and not by those who have the experience of collecting Central Excise and Service Tax, which accounts for 56% of GDP.

There is also stiff opposition to the whole idea of setting up a private limited company (GSTN), which is headed by a retired IAS officer, to implement GST.

While stating that they already have a successful track-record of assessment, collection, duty drawback and refunds, backed by one of the most efficient manpower and the best system in the world, the IRS officers are  pointing out that the Central Excise and Service Tax website handles the important job of Registration, Return filing and Duty Payment. They are particularly drawing attention towards their professional competency and asserting that the GST Secretariat should not be allowed to be run by generalists.

On the Customs side, it is being pointed out by the IRS officers that besides their duty to assess, their Single Window, ICEGATE (Indian Customs EDI Gateway) or the e-Commerce Portal of Central Board of Excise & Customs, and the Risk Management System (RMS), which is an IT driven system with the primary objective to strike an optimal balance between facilitation and enforcement, can be compared with the best systems anywhere in the world.

An IRS officer stated that the Directorate General of Central Excise Intelligence (DGCEI), Directorate of Revenue Intelligence (DRI) and their Audit are professionally managed and touch global standards. He further said that they ensure minimum interface, absolute transparency, and follow strict deadlines when it comes to taking decisions. Taking a jibe at the Government of India for entrusting the administration of GST Council and GST Network to IAS officers, he said this is highly demoralising for the Indian Revenue Service officers.

An IRS officer wrote on a social networking platform that “with weak and demoralised work-force, the Centre neither can be strong nor can it fulfill its responsibilities in a judicious manner vis-a-vis the Directive Principles of State Policy An economically weak Centre is a death knell for Democracy and Cooperative Federalism, he said adding the need of the hour is a professionally driven Tax Administration System.”

Another IRS officer reacted in sharp terms he said: “The idea of forming a private limited company with private players to implement the GST goes against the whole concept of sovereign responsibility of administering tax administration. It is to be underscored that India is a Union of States and the Union should not become weak by giving the States unnecessary leverage in administering the GST. It was weak institutional framework and tax administration that was responsible for the fiscal developments that eventually flared up the Greek crisis.”

The Union Cabinet in its meeting held on 12 September, 2016 approved setting-up of GST Council and its Secretariat. Simultaneously, it was announced that the first Meeting of the GST Council will be held on 22 and 23 September 2016 in the national Capital.

The Cabinet took decisions for the following:

  • Creation of the GST Council as per Article 279A of the amended Constitution;
  • Creation of the GST Council Secretariat, with its office at New Delhi;
  • Appointment of the Secretary (Revenue) as the Ex-officio Secretary to the GST Council;
  • Inclusion of the Chairperson, Central Board of Excise and Customs (CBEC), as a permanent invitee (non-voting) to all proceedings of the GST Council;
  • Create one post of Additional Secretary to the GST Council in the GST Council Secretariat (at the level of Additional Secretary to the Government of India), and four posts of Commissioner in the GST Council Secretariat (at the level of Joint Secretary to the Government of India).

The Cabinet also decided to provide for funds for meeting the recurring and non recurring expenses of the GST Council Secretariat, the entire cost for which shall be borne by the Central Government. The GST Council Secretariat shall be manned by officers taken on deputation from both the Central and State Governments.

The Constitution (122 Amendment) Bill, 2016, for introduction of Goods and Services Tax (GST) in the country was accorded assent by the President on 8 September, 2016, and the same has been notified as the Constitution (101) Act, 2016.

As per Article 279A (1) of the amended Constitution, the GST Council was to be constituted by the President within 60 days of the commencement of Article 279A. The notification for bringing into force Article 279A with effect from 12 September, 2016 was issued on 10 September, 2016.

As per Article 279A of the amended Constitution, the GST Council will be a joint forum of the Centre and the States. This Council shall consist of the following members:

  • Union Finance Minister – Chairperson
  • The Union Minister of State, in-charge of Revenue of finance -Member
  • The Minister In-charge of finance or taxation or any other Minister nominated by each State Government – Members

As per Article 279A (4), the Council will make recommendations to the Union and the States on important issues related to GST, like the goods and services that may be subjected or exempted from GST, model GST Laws, principles that govern Place of Supply, threshold limits, GST rates including the floor rates with bands, special rates for raising additional resources during natural calamities/disasters, and special provisions for certain States.


Goods and Services Tax Network (GSTN)†

It is a not-for-profit, non-Government Company set up by the Centre and States for implementation of the Goods and Services Tax (GST) by providing shared IT infrastructure and services to Central and State Governments, tax payers and other stakeholders.

GSTN is a National Information Utility (NIU) set up to provide an IT Backbone for the “smooth functioning of the Goods & Services Tax regimen”. It is being projected as an entity to “leverage the entire nation as One Market with minimal Indirect Tax compliance cost”.

GSTN was incorporated on March 28, 2013. The Government of India holds 24.5% equity in GSTN and all States of the Indian Union, including NCT of Delhi and Puducherry, and the Empowered Committee of State Finance Ministers (EC), together hold another 24.5%. Balance 51% equity is with non-Government financial institutions.

GSTN is a private limited company registered under the Companies Act, 1956. The Authorised Share Capital of the company is INR 10,00,00,000 (Rupees 100 million) with 49% equity of the company held by the Government (24.5% Central Government and 24.5% all State Governments/UTs put together) and 51% equity is held by private financial institutions namely ICICI Bank, HDFC Bank, HDFC Ltd, LIC Housing Finance and National Stock Exchange Strategic Investment Corporation Ltd.

Organisation Structure

Today GSTN has a team of 46 full time employees including 37 from the Private Sector and 9 deputationists from the Government. The Organisation Structure of the Company broadly consists of 3 verticals, viz. Technology, Services and Support, each headed by an Executive Vice President (EVP) reporting to the CEO. The Technology team is to be entirely sourced from the Private Sector, Services Team from deputationists consisting of Tax Officials from the Central and State Governments and the Support team is a mix from both Private Sector as well deputationists.

Indian IT services Company Infosys, through a competitive bidding process, in which other big IT companies like TCS, Wipro, Tech Mahindra and Microsoft also participated, bagged the contract of Rs 1,380 crore to be the Managed Service Provider (MSP) for GSTN.

The MSP shall build the technology infrastructure for Goods and Services Tax known as the GST System Project (GSTSP), a common Portal for the use of different Tax Payers, Tax Administrators and other stakeholders which includes common Registration, Return and Payment services. The MSP will build the system and once it is ready they will operate it for five years. The Contract with Infosys was signed on 6 November 2015.

Navin Kumar, a retired 1975 batch IAS officer, is the Chairman of the Goods and Services Tax Network.

GSTN Mandate

  • Provide common and shared IT infrastructure and services to the Central and State Governments, Tax Payers and other stakeholders for implementation of the Goods & Services Tax (GST).
  • Provide common Registration, Return and Payment services to the Tax payers.
  • Partner with other agencies for creating an efficient and user-friendly GST Eco-system.
  • Encourage and collaborate with GST Suvidha Providers (GSPs) to roll out GST Applications for providing simplified services to the stakeholders.
  • Carry out research, study best practises and provide Training and Consultancy to the Tax authorities and other stakeholders.
    Provide efficient Backend Services to the Tax Departments of the Central and State Governments on request.
  • Develop Tax Payer Profiling Utility (TPU) for Central and State Tax Administration.
  • Assist Tax authorities in improving Tax compliance and transparency of Tax Administration system.
  • Deliver any other services of relevance to the Central and State Governments and other stakeholders on request.

† authorised websites

Make in India Programme: CBEC profiling top 20 commodities to leverage Tariff Policy

Lalit Shastri

CBECThe Central Board of Excise and Customs (CBEC) is going in for a 360 degree profiling of top 20 commodities in terms of valuation, duty rates – both with regard to manufacturing and imports to enable policy intervention and leveraging the Tariff Policy as a key component of Prime Minister Narendra Modi’s flagship “Make in India” Programme.

Special Secretary and Member CBEC Najib Shah, who is currently Chairman in-Charge of the Board, shot a DO letter to all Chief Commissioners, Director Generals and Principal Commissioners Excise and Customs on 5 August 2015 cautioning them against complacency and underscoring that close monitoring of tariff line-wise trends by each commissionerate is crucial for understanding the impact of change in tariffs and trends in revenue collection. Asking them to undertake a study of top-20 tariff lines, commodities and services for the 2014-15 fiscal and quarter ending 30 June this year to leverage the Tariff Policy keeping in view the Make in India Programme. The CBEC has set September 30 as the deadline for the Chief Commissioners to submit their reports.

CBEC will also focus attention on Government’s key mission of improving “ease of business”. To meet this objective, the commissionerate wise zonal heads of Excise and Customs have been asked to give a feedback from industry based on close interaction with leading services providers, manufactueres and importers. While a one time exercise to give a feedback by September 1 with regard to business process re-engineering will be undertaken immediately, the process of interaction with the tax payers will be an ongoing process.

To address public grievances and to provide improved access to the tax payers, a new Directorate of Tax Payers Services is also being created. It will be mandated to focus on taxpayer outreach, education, communication and would also act as a medium for the Board to respond to the taxpayers’ concerns.

Najib Shah has shared the concerns of the field formations on the HR and infrastructure related issues. Acknowledging that “there are a lot of vacancies at various levels, he has stated in his letter that necessary steps are being taken to fill these and also that proposals for enhancing infrastructural capacity have been sent to Director General HRD.