MAINTENANCE OF ACCOUNTS

MAINTENANCE OF ACCOUNTS

2. PRODUCTION AND INSPECTION OF BOOKS DOCUMENTS AND ACCOUNTS

2.1       Production of Books of Accounts

 A taxing authority may, for the purposes of this Act, require any dealer to produce before him any book, document or account relating to his business and may inspect, examine and copy the same and make such enquiries from such dealer relating to his business, as may be necessary.

2.2       Maintenance of Accounts

 Every registered dealer shall -

(a) maintain day to day accounts of his business;

(b) maintain a list of his account books, display it along with his registration certificate and furnish a copy of such list to the assessing authority;

(c) produce, if so required, account books of his business before the assessing authority for authentication in the manner given below:-

• A registered dealer when required by the assessing authority shall produce before it any book, document or account relating to his business for the purpose of authentication.
• The Assessing Authority may, as far as possible with prior notice, authenticate the books of accounts of the dealer by visiting his place of business where the books, documents or accounts are kept.
• The Assessing Authority shall append his signature along with his seal at one or more places in each of the books, documents or accounts and record a certificate in the following form at the opening page thereof:

"Certified that this book/document/account contains pages _____________ to ___________________and I have put my signatures along with the official seal at page Nos. _____________ and ______________.

(Signature of assessing authority)

Name in CAPITALS ________________________________

District _______________________________________

Date _____________________________

• The assessing authority shall keep a regular record of such authentication in the file of each dealer for utilisation at the time of inspection of his accounts or stocks.
• The assessing authority shall make a note of such authentication on the list, maintained under section 29 by the dealer.

(d) retain his account books at the place of his business, unless removed therefrom by an official for inspection, by any official agency or by auditor, or for any other reason which may be considered to be satisfactory by the assessing authority;

(e) preserve his account books for a period of 8 years after the close of the year to which such books relate and where some proceedings under this Act are pending, till the completion of such proceedings.

In continuation of the above discussion, I am of a confirmed view that GST in Indiatransperancy & avoiding complexities are the essence of GST.

2.3       Seizure of books and accounts

 If any officer under section 29 (1) has reasonable grounds for believing that any dealer is trying to evade liability to tax or other dues under this Act, and that anything necessary for the purpose of an investigation into his liability may be found in any book, account, register or document, the officer may seize such book, account, register or document as may be necessary. The officer seizing the book, account, register or document shall forthwith grant a receipt for the same and shall:-

(a) in the case of a book, account, register or document which was being used at the time of seizing, within a period of 30 days from the date of seizure; and

(b) in any other case i.e., which was not used at the time of seizing, within a period of 180 days from the date of seizure,

return it to the dealer or the person from whose custody it was seized, after examination or after having such copies or extracts taken therefrom as may be considered necessary; provided the dealer or the aforesaid person gives a receipt in writing for the book, account, register or document returned to him. The officer may, before returning the book, account, register or document, affix its signatures and its official seal at one or more places thereon, and in such case the dealer or the aforesaid person will be required to mention in the receipt given by him the number of places where the signatures and seal of such officer have been affixed on each book, account, register or document.

However, the seized book, account, register or document may be retained for a longer period if so required.

Also, if the seized book, account, register or document is retained by any taxing authority other than the Commissioner for more than the period specified above, as the case may be (30 days or 180 days), the reasons for doing so shall be recorded in writing and the approval of the Commissioner shall be obtained by the said authority before the specified period or the extended period, as the case may be, expires,

However, if any proceedings taken up as a result of examination of seized material shall be concluded before the expiry of 1 year from the date of the seizure except that the proceedings may, with written permission of the Commissioner, continue for 1 more year.

2.4       Public Auction

Goods which are detained under section 31(6) and which are not released owing to failure to furnish security or to pay the penalty imposed under section 31 (8) within the time allowed shall be sold in public auction after following the procedure as laid down below –

(a) the officer shall cause to be published on the notice board of his office a list of the goods detained and intended for sale with a notice under his signatures specifying the place where, and the day and hour at which, the detained goods are to be sold and display copies of such lists and notice at more than one public places near the Check Post or barrier or other place where the goods were detained. Copy of the list and notice shall also be displayed in the office of the Officer In charge of the district having jurisdiction over the area where the check post or barrier or other place where the goods were detained is situated. Normally, a notice of not less than ten days shall be given before the auction is conducted.

(b) Intending bidders shall deposit as earnest money a sum equal to ten per centum of estimated value of goods.

(c) At the specified day and time, the goods shall be put up in one or more lots, as the officer conducting the auction/sale may consider advisable, and shall be knocked down in favour of the highest bidder subject to confirmation of the sale by the Officer in charge of the district concerned if the officer conducting the auction is an officer subordinate to the officer in charge of the district.

(d) The auction purchaser shall pay the sale value of the goods in cash immediately after the sale and he will not be permitted to carry away any part of the goods until he has paid for the same in full and until the sale has been confirmed by the appropriate authority. If the purchaser fails to pay the purchase money, the goods shall be resold by auction in the same manner as mentioned in points (a), (b) and (c) above and earnest money deposited by the defaulting bidder shall be forfeited to the State Government. The earnest money deposited by the unsuccessful bidders shall be refunded to them immediately after the auction is over.

(e) If any order directing detention is reversed on appeal the goods so detained, if they have not been sold before such reversal comes to the knowledge of the officer conducting sale, shall be released, or if they have been sold, the proceeds thereof shall be paid to the owner of the goods;

(f) No goods shall be sold by auction under this rule except with the prior approval of the officer in charge of the district.

(g) Where any goods required to be disposed of by public auction are of perishable nature or subject to speedy and natural decay or are such as may, if held, lose their value or when the expenses of keeping them are likely to exceed their value, then such goods may, with the approval of the officer incharge of the district, be sold immediately to the highest of at least three offerors, dealing in like goods, making the offers on invitation.

2.5       Miscellaneous            
(i) The provisions of section 29 (2) shall apply mutatis mutandis to every such dealer who is liable to furnish returns under section 14(2).

(ii) A taxing authority, assisted by such persons as he may consider necessary, may enter and search any office, shop, godown or any other place of business of the dealer or any building, dwelling house or place, or means of transport, goods carrier or vehicle where such officer, has reasons to believe that the dealer keeps, or is for the time being keeping, any book, account, register, document, goods or anything relating to his business.

Provided that before entering and searching any premises the aforesaid officer shall record in writing the reasons for making such entry and search and shall obtain the sanction of the Commissioner or of such other officer not below the rank of Deputy Excise and Taxation Commissioner as the Commissioner may, for this purpose, authorise in writing:

However, no entry for search in a dwelling house shall be made -

• after sunset and before sunrise;
• by an officer below the rank of an Excise and Taxation Officer;
• without obtaining the sanction of the Deputy Commissioner or Sub-Divisional Officer (Civil) within whose jurisdiction such house is situated.

(iii)  A taxing authority, can use the power in the following ways:-

• where any person in or about such premises is reasonably suspected of concealing about his person anything for which search should be made, to search such person, and, if such person is a woman, the search shall be made by another woman, with strict regard to decency;
• to open and search any box, till or receptacle in which any book, account, register, document, sale proceeds, goods or anything which is relevant to any proceeding under this Act may be contained;
• to make a note or inventory of anything including cash and goods found as a result of such search;
• to record the statement of a dealer or any person connected with his business including a bailee or a transporter, and such statement may, after giving the affected person a reasonable opportunity of being heard, be used for the purpose of determining his liability to tax;

(iv) Where any officer finds any taxable goods in any office, shop, godown or any other place of business or any building or place, or goods carrier or vehicle of, or which for the time being is under the control of, a dealer on whom the provisions of section 14 (2) apply but not accounted for by him or the person incharge of the goods carrier or vehicle in his books, accounts, registers and other documents, the officer may, after giving such dealer a reasonable opportunity of being heard, impose on him a penalty computed by multiplying the value of the goods with 3 times the rate of tax applicable on sale of goods subject to a maximum of 30 % of the value of the goods, and direct him to account for the goods in his books of account,

However, where the goods accounted for are underpriced, the penalty shall be computed by multiplying the difference between the market price and the price at which the goods have been accounted for with three times the rate of tax applicable on sale of goods.

CGST in GST the penalty provisions have been added to avoid tax evasion.

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