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CA Final · Indirect Tax Laws · Inspection, Search, Seizure and Arrest

Mehta Logistics runs a godown in Pune. Based on information, a Joint Commissioner of CGST believes the godown keeps goods that have escaped payment of tax. He wants an officer subordinate to him to inspect the godown. Under the CGST Act and Rules, what is the correct procedure?

The Joint Commissioner authorises the subordinate officer in writing in FORM GST INS-01. Section 67(1) permits written authorisation for inspecting a godown where goods are believed to have escaped tax, and the rules prescribe that form. No Magistrate order is needed, and INS-03 relates to non-removal orders.

  1. AHe authorises the subordinate officer in writing, using FORM GST INS-01, to inspect the placeCorrect
  2. BThe subordinate officer may inspect on his own, without any written authorisation
  3. CHe must first obtain an order from a Magistrate before authorising any inspection
  4. DHe must issue an order of prohibition in FORM GST INS-03 before inspection

Explanation

Under section 67(1), a proper officer not below the rank of Joint Commissioner who has reason to believe goods have escaped tax may authorise in writing another officer of central tax to inspect the place. Rule 139(1) prescribes FORM GST INS-01. FORM GST INS-03 is a prohibition order for goods that cannot practicably be seized, so it is not the inspection authorisation.

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