Authorised Representative plays a crucial role by appearing as a legal representative of another person in adjudicating proceedings under the GST regime. Section 116 provides qualification,disqualification and other procedures relating to authorised representative which are articulated under this article.
Authorised Representative is a authorised by a person to appear on his behalf in any proceedings. ‘Authorised Representative’ has been defined in the Goods and Services Act itself. Section 2(15) of the central Goods and services Act ,2017 (hereinafter reffered to as “ the CGST Act”) defines ‘authorised representative’ as representative reffered to in section 116. Broadly, it includes a relative, a regular employee, an advocate, a charted accountant, a company secretary, or any person with prescribed qualifications. It is also provided that indirect tax gazetted officers can appear as authorised representative after one year from retirement.
The GST law also specifies for some disqualification for an authorised representative such as dismissal from government service, conviction under some specified Acts, insolvency, misconduct, etc. Such orders of disqualification are, however , required to be passed after complying the principles of natural justice.
2 . Appearance by authorised representative
Section 116(1) provides that any person can appear by an authorised representative in any proceedings under the Goods and Services regime.By virtue of this, an authorised representative can appear before the following authorities-
1. GST Officers,
2. The Appellate Authority under GST Law,
3.The Appellate Tribunal under GST Law.
However, a person is not allowed to appear by an authorised representative when he is required under the Act to appear personally for examination on oath or affirmation.
3. Persons who can be authorised representative
Section 116(2) places limitation on the persons who may be authorised to represent before the authorities. The following categories of persons are so permitted to act as an authorised representative on his behalf -
Relative or regular employee of an registered person who has authorised him to act can be appointed as an authorised representative.
An advocate who is entitled to practice in any court in india, and who has not been debarred from practicing before any court in india, can represent the assessee.
Any charted accountant, a cost accountant or a company secretary who holds a certificate of practice and who has not been debarred from practice, are permitted to act as an authorised representative.
4. Government officers
A retired officer of the Commercial tax department of any State Government or Union territory or of the Board who, during his services under the Government had worked in a post not below the rank than that of a Group –b Gazetted officer for a period of not less than two years can be a appointed as an authorised representative.
However, such officer would not be entitledto appear before any proceedings under the GST Act for a period of one year from the date of his retirement or resignation.
5. GST practitioner
A GST practitioner would also be allowed to appear as authorised representative before any officer of department, Appellate Authority or Appellate Tribunal, on behalf of a registered person who has authorised him to be his GST practitioner.
4. Disqualification for acting as an authorised representative
The Disqualifying factors in relation to a person representing the assessee under section 116 are contained in sub-section (3) thereof which are as follows:
1. Who has been dismissed or removed from Government services; or
2. Who is convicated of an offence connected with any proceedings under this Act, the State Goods and Services Tax Act, the Integrated Goods and Services Tax Act or the Union Territory Goods ad Services Tax Act, or under the existing law or under any of the Integrated Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, or under the existing law or uder any of the Acts passed by a State Legislature dealing with the imposition of taxes on sale of goods or supply of goods or services or both; or
3. Who is found guilty of misconduct by the prescribed authority;
4. Who has been adjudged as an insolvent.
Such disqualifications to act as an authorised representative would work for the period as mentioned under-
5. Action for misconduct of an authorised representative
In term of rule 116 of the CGST Act, 2017, where an authorised representative, ( other than those advocate/ CA/ CS/ CWA) is found, upon an enquiry into the matter, guilty of connection with any proceedings under the act, the Commissioner may, after providing him an opportunity of being heard , disqualify him from appearing as an authorised representative.
6. principle of natural justice to be followed
The principle of natural justice has to be observed before any adverse action is going to be observed before any adverse action is going to be taken against the assessee. One of the grant of an opportunity of hearing, oral or in writing,before conclusion is arrived at by the authority exercising their powers.
7. Applicability of SGST Act/ UTGST Act
Any person who has been disqualified under the provisions of the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act will be deemed to be disqualified under the GST Act as stated under section 161(4) of the CGST Act.
8. Applicability of IGST Act
Section 20 of the IGST stipulates that the provisions of the CGST Act would, mutatis mutandis, apply to integrated tax as they apply in relation to central tax as if these are enacted under this Act. Accordingly, there is no separate provisions regarding authorised representative under the IGST Act, thus, the provision available under the CGST Act, is made applicable to IGST Act.
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In the case of Pr.CIT, New Delhi v. Delhi Airport Metro Express Pvt.Ltd. [ITA No. 705/2017, decided on 5-9-2017] the Commissioner opined that assessing officer allowed depreciation in excess of what was assessing officer to make fresh assessment. The Delhi High Court held that for the purpose of exercising jurisdiction under section 263 of the Act, the conclusioin that the order of the assessing officer is erroneous and prejudicial to the interests of the Revenue has to be preceded by some minimal inquiry. That basic exercise of determining as to what extent the depreciation was claimed in excess has not been undertaken by the Pr. CIT. He had exercised the second option available to him under section 263(1) of the Act by sending the entire matter back to the assessing officer for a fresh assessment. That option, in the considered view of the Court, can be exercised only after the Pr. CIT undertakes an inquiry himself. The High Court held that revision was not justified.The learned author discusses the case in detail.
Subject to it’s Explanations, section 263(1) of the Income Tax Act,1961 (‘Act’) states that the principal Commissioner may call for and examine the record of any proceeding under the Act, ad if he considers that any order passed therein by the assessing officer is erroneous on so far as it is prejudicial to the interests of the revenue, he may after giving the assessee an opportunity of being heard and after such order thereon as the case justify, including an order enhancing or modifying the assessment, or canceling the assessment and directing a fresh assessment.
More recently, in Pr. CIT, New Delhi v. Delhi Airport Metro Express pvt.Ltd. [ITA No. 705/2017, decided on 5-9-2017], the short question raised by the Revenue was whether the ITAT was justified in setting aside the order of the Principle Commissioner of Income Tax (‘Pr. CIT’) passed under section 263 of the Act in respect of assessment year 2011-12 setting aside the original assessment order dated 31-12-2013 passed by the Assessing Officer (‘AO’) under section 143(3) of the Act.
2. Facts of the case
The brief facts in the above –mentioned case were that the assessee being a concessionaire of the Airport Metro Express Project of the Delhi Metro Rail Corporation Ltd. (‘DMRC’) under a Build-Operate-Transfer (‘BOT’) Scheme, had accepted the concession for a period of 30 years During the assessment year in question, the assessee claimed depreciation of Rs.112,29,74,447, on fixed assets of Rs.15,60,48,17,189 50% of the eligible depreciation rates since, during the assessment year in question, the assets were used for less than 180 days. The assessing officer framed the assessment under section 143(3) of the Act allowing depreciation as claimed by the assessee.
The case of the revenue was that the assets were developed under the BOT scheme and the assessee was not eligible to claim depreciation as it was not the owner of the assets. The Revenue contended that the land for the project was handed over by the DMRC to the assessee as Concessionaire of the basic structure was also done by the DMRC.
The case of the assessee was that during the assessment year in question it had purchased and installed plant and machinery and such plant and machinery was legally owned by it. It was further contended that since such assets were used for the purpose assessee’s business,it was entitled to claim depreciation under section 32 of the Act.
The Pr. CIT, in exercise of powers under section 263 of the Act issued a show cause notice (SCN) dated 16-3-2015 to the assessee pointing out that if the value of these fixed assets were to be amortized evenly over a period of 30 years, the amount of to be amortized would only be Rs.52,01,60,572 for each year. Therefore, the depreciation allowed to the assessee was in excess by Rs. 60,28,13,875 and, to that extent, the order passed by the assessing officer was prejudicial to the interest of the Revenue. In reply to the SCN, the assessee took the stand that, interest of the Revenue. In reply to the SCN, the assessee took the stand that, during the assessment year in question, it “had purchased the assets from independent vendors, out of its own funds for settings up the project.
Thereafter, order dated 30-3-2016 was passed by the Pr. CIT.
3. Thus held the court
The learned Judges of the Delhi High Court observed that for the purpose of exercising jurisdiction under section 263 of the Act, the conclusion that the order of the assessing officer is erroneous and prejudicial to the interests of the assessing officer is erroneous and prejudicial to the interests of the Revenue has to be preceded by some minimum inquiry. In fact, if the Pr. CIT was of the view that the AO did no undertake any inquiry, it became incumbent on the Pr. CIT to conduct such inquiry. All that Pr. CIT had done in the order was to refer to the Circular of the CBDT and conclude that “in the case of the assessee company, the assessing officer was duty-bound to calculate and allow depreciation on the BOT in conformity of the CBDT Circular No. 9/2014 but the assessing officer is erroneous insofar as prejudicial to the interest of revenue”. In the considered view of the Court,this can hardly constitute jurisdiction under section 263 of the Act. In the context of the present case depreciation on assets like land and building, it was incumbent upon the purchased and installed by the assessee out of its own funds during the assessment year in question and, which were those assets that were handed over to it by the DMRC. That basic exercise of the determining as to what extent the depreciation was claimed in excess has not been undertaken by the Pr. CIT. He had exercised the second option available to him under section 263(1) of the Act by sending the entire matter back to the assessing officer for a fresh assessment. That option, in the considered view of the Court, can be exercised only ofter the Pr. CIT undertakes an inquiry himself in the manner indicated hereinbefore. That was missing in the present case.
Finally, the Delhi High Court held, in respect of the appeal, that the ITAT was not in error in setting aside the order of the Pr. CIT under section 263 of the Act, no substantial question of law arose herein.
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