AITF terms 54769 cases of VAT assessment of year 2013-14 fixed by SGST department, assessment notices “illegal”

Ludhiana: All Industries & Trade Forum (AITF) national president Badish Jindal has sent a representation to Punjab Chief Minister Capt Amarinder Singh, stating that 54769 cases of VAT assessment of year 2013-14 fixed by the SGST department, Assessment notices are illegal as the previous government had exempted assessment of cases upto 1 crore and 90 per cent assesses are below the turnover of 1 crore. 

The representation reads that recently the department of SGST issued notices to 54769 entrepreneurs for assessment of their VAT cases for the year 2013-14. In these cases, 23277 notices issued by Ludhiana office of SGST (11309 District I, 5967 District II & 6001 District III), 14208 notices issued in Jalandhar and 6249 notices for assessment are issued by the Amritsar SGST office. Beside this, two notices of 14383 & 14333 cases are separately issued by the department for assessment of VAT cases. 

He added that its almost more than 3 years when VAT abolished in the state and these notices are of 2013-14 which is almost 7 year old. It’s indeed shocking to see the quantum of notices issued by the department issued without any logic. 

Further, he said the total number of VAT assesses in the state were around 130000 so the department issued assessment notices to more than 60% of the total assesses of the state. There is no criteria fixed for selection of cases and it seems that the only purpose behind the assessment is the vested interest of the department. The department has fully failed to prevent the state from bogus transections even with the online return filing systems under VAT and at that time the invoices were also online which were called E-Trips. Now it is feared that after 7 years the department may harass the innocent assesses on the name of assessments.  

Jindal stated that on 31st January 2015 the then Excise & Taxation Minister issued the orders for exemption of assessment of the companies having turnover less than 1 crore. The purpose was to caught the big fishes and to save the industry from the harassment and corruption of the VAT department. It is really shocking to see that in the new selection of assessment, 90% cases are below the limit of 1 crore. So it may prove to be more harassment to the small assesses than to bring the revenue to the exchequer. 

“If we go through the track records of assessments during previous years the revenue from assessment was never above 5% of the total revenue of any period”, he said, adding, “So instead of revenue the main purpose of assessment seems the corruption.” 

He said the department is merely having less than 30 AETCs and 100 ETOs.  So with this bleak strength how the department could manage properly the assessment of 90000 cases fixed for assessment. The huge evasion is going in GST and the department is willing to bind itself to the year old minor cases for the reason best known to them. It’s a hard fact that the department has recovered nothing from the units caught for bogus billing during 2007-08 to 2016-17. Instead of recovery from the main accused’s the tax was recovered from the innocent dealers on the name of fourth stage verification. 

He said even in its report the CAG has found the huge irregularities in the assessment process of VAT department and it was mentioned that the percentage of disposal of cases is merely 25.90%. as per CAG report at the end of 2018-19, 106781 cases were already pending with the department for assessment.  

He stated that the officers are threatening the assesses on the name of fourth stage verification whereas after 7 years how the assesses may prove the verification of their purchasers. 

As per rule the department can only charge the interests from the date of assessment order but the officers are threatening the assesses for charging the interests on in-genuine purchases from the date of purchases. 

Concluding, he said such acts are against the ease of doing business model of the state and may impact the Invest Punjab initiative of your government. This is also an act of tarnishing the reputation of the government among trade and industry. 
Therefore, Jindal requested that department should be ordered to quash all cases fixed for assessment in any year and only the doubtful cases shall be selected for assessment.