GST Audit Team to Consult TRU or GST Policy Wing before making any demand to tax interpretation.
The GST Council in their meetings has addressed the need for alignment of GST classification with international standards such as the United Nations’ Central Product Classification (UNCPC).
CBIC has issued an official instruction (Instruction No. 03/2024-GST) which provides guidance on applying a specific paragraph (2(g)) from an earlier instruction (Instruction No. 01/2023-24-GST (Inv.)) during audit proceedings.
The key focus of this instruction is to ensure that when an audit identifies an issue related to tax interpretation—where there could be multiple interpretations leading to potential litigation—the concerned Chief Commissioner should refer the matter to the relevant policy wing of the Board, such as the GST Policy or TRU (Tax Research Unit). The instruction emphasizes the importance of making such references before concluding investigations to promote uniformity in tax interpretation and reduce unnecessary litigation.
Reason for Issuance of the Note : The need to issue this note arose to ensure consistency and uniformity in the interpretation of GST laws across different zones and cases. It aims to address situations where different interpretations of the law by various officers could lead to inconsistent tax enforcement, potential litigation, and disruption to businesses. By referring complex interpretation issues to a higher authority (the relevant policy wing), the instruction seeks to avoid such discrepancies, ensuring a more streamlined and predictable application of the GST law across India.
Hoping there would be more ease of doing Business and the Trade will not be troubled or surprised by enthusiastic or Target driven pressurised officer..
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