A new rule 51A has been introduced under the Punjab VAT Act 2005 authorizing the commissioner or designated officer under the Act to lock the TIN No of the person registered under the Act. Locking the TIN no means the temporary stoppage of interstate movement of goods of the concerned person for the purpose of verification or further legal action. Temporary stoppage is done by locking the TIN No of the concerned person in the server of the software used by the VAT Department all over the state including at barriers set up at the various borders of the state.
TIN no of a person can be locked as per rule 51A if
- he fails to pay any tax, penality or interest payable under the Act or
- fails to furnish a return or returns or annual statement by the prescribed date or
- has filed incomplete or incorrect returns or
- has conducted huge transactions as per Information Collection Centre data available in the computer system but has not filed corresponding returns or
- no business at the declared place is being conducted or
- has failed to comply with the requirements of any notice issued by a designated officer
Proviso to the rule 51A provides that a notice in form VAT 58 shall be issued immediately after locking of the Tax Identification Number by the designated officer to the person concerned stating therein the action taken and the reasons thereof. Any TIN No whenever is locked or reopened this fact shall be displayed in office notice board.
Thus its clear that after locking the TIN No of a registered person a proper notice needs to be issued stating therein the reasons for the action taken to the person concerned. But no notices are being issued as required under rule 51A by the department after locking the TIN No. The return defaulter's TIN Nos are locked immideately after the due date by the deaprtment. But no notices are issued in VAT form 58 by the department after locking the TIN No, which is a clear violation of Rule 51A and is also violation of rules of natural justice since the person concerned is denied the reasonable oppurtunity of being heard. If a person does not know the reasons why his TIN No is locked how can he compile with the default for which his TIN No is locked. The need of the hour is that the department should wake up and start complying with the provisions of Rule 51A and should issue notices in form VAT 58 after locking the TIN NO of the person concerned.
TIN no of a person can be locked as per rule 51A if
- he fails to pay any tax, penality or interest payable under the Act or
- fails to furnish a return or returns or annual statement by the prescribed date or
- has filed incomplete or incorrect returns or
- has conducted huge transactions as per Information Collection Centre data available in the computer system but has not filed corresponding returns or
- no business at the declared place is being conducted or
- has failed to comply with the requirements of any notice issued by a designated officer
Proviso to the rule 51A provides that a notice in form VAT 58 shall be issued immediately after locking of the Tax Identification Number by the designated officer to the person concerned stating therein the action taken and the reasons thereof. Any TIN No whenever is locked or reopened this fact shall be displayed in office notice board.
Thus its clear that after locking the TIN No of a registered person a proper notice needs to be issued stating therein the reasons for the action taken to the person concerned. But no notices are being issued as required under rule 51A by the department after locking the TIN No. The return defaulter's TIN Nos are locked immideately after the due date by the deaprtment. But no notices are issued in VAT form 58 by the department after locking the TIN No, which is a clear violation of Rule 51A and is also violation of rules of natural justice since the person concerned is denied the reasonable oppurtunity of being heard. If a person does not know the reasons why his TIN No is locked how can he compile with the default for which his TIN No is locked. The need of the hour is that the department should wake up and start complying with the provisions of Rule 51A and should issue notices in form VAT 58 after locking the TIN NO of the person concerned.
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