Companies moving their principal place of business to a new GST jurisdiction will not have to restart pending tax proceedings, with the Central Board of Indirect Taxes and Customs (CBIC) clarifying that the new jurisdiction will take over and complete all ongoing cases from the stage at which it was left, PTI reported.This clarification comes after the CBIC received signals from field formations requesting guidance on the validity of the procedures and the authority responsible for handling cases when a registered taxpayer changes its jurisdiction due to a shift in its principal place of business.Under the circular, any action or proceeding – including investigation, audit, show cause notice or adjudication under the Central GST Act – initiated by a tax officer having jurisdiction over the registered taxpayer at the time of taking the action (transferring jurisdiction) will remain valid even if the taxpayer subsequently shifts to another tax jurisdiction (transferring jurisdiction).“The transferring jurisdiction shall act, implement and act on the basis of such previous correct action taken by the transferring jurisdiction, as if it had initiated the same,” the circular said.The Indirect Taxes Board further clarified that if any new problem is brought to the notice of the previous jurisdiction after the shift of the taxpayer, the tax officer must inform the new jurisdiction to take appropriate action.
“When a taxable person migrates to another jurisdiction during the pendency of any action or proceeding initiated by the transferring jurisdiction, the transferring jurisdiction shall take over and complete the matter from the stage it was at at the time of migration/transfer,” the China Development Bank (CBIC) circular said.The new judicial officer will also have the authority to initiate and terminate any subsequent proceedings arising from the case.Rajat Mohan, managing partner at AMRG Global, said the clarification addresses a key procedural gap under the GST regime.“By clearly defining the responsibilities of transfer and remittance authorities, COMCEC BI Bank eliminated ambiguity that often led to judicial objections and delays in adjudication,” Mohan said.
