CEOs not to be issued summons at first instance for GST evasion: DGGI

The Directorate General of GST Intelligence (DGGI) has issued guidelines, which seek to soften the impact of investigations and ensure that no excesses are committed that include minimal personal summons, no repeated summons and generally not issuing summons to CEOs and CFOs of large companies in the first instance for GST evasion.

In a circular issued last week, the Directorate said, "As an enforcement agency, it is imperative for the DGGI to maintain a balance wherein investigations should proceed strictly, as per law, while simultaneously ensuring that no excesses are meted out to the taxpayers and their sensibilities are respected."

The officers have been asked to ensure that a summon for personal appearance is issued only when specifically required. This would imply that the personal presence of an individual is minimised.

In addition, summons should not be issued repeatedly and as far as practicable, a comprehensive statement should be recorded in the first instance itself. The implication of this measure is that any harassment is avoided with repeated summons, personal appearances and whatever needs to be recorded is done at the first instance.

The DGGI has also prescribed that summons for calling for information should also not be issued in a piecemeal manner and as far as possible all relevant information should be gathered in one go.

In an important intervention, the DGGI prescribed, "Senior management officials such as CEO, CFO, General Manager of a large company or a PSU should not generally be issued summons at the first instance unless the evidence suggests otherwise."

The DGGI further said that while conducting a search, the officers should be sensitive towards the assessee or party. Special attention should be given to elderly, women and children present in the premises under search.

"Children should be allowed to go to school, after examining their bags. A woman occupying any premises, to be searched, has the right to withdraw before the search party enters, if according to the customs she does not appear in public. If a person in the premises is not well, a medical practitioner may be called. Religious sentiments of the person under search should not hurt in any way," the DGGI said.

Further, amid the Covid-19 pandemic, proper social distancing norms should be followed and the search team should take all precautionary measures as contained in the guidelines.