SUMMONS TO BUSINESS ENTITIES

[Dr. Sanjiv Agarwal]

How summon to be issued?

A summon issued under section 70 of CGST Act, 2017 to give evidence or produce documents shall be issued by CGST/SGST officer in writing, duly authorized by the competent authority.

It can be said that for initiating summon proceedings, a summon has to be issued in writing only. However, mode of communication can be in electronic mode also. Further, summons should bear a Document Identification Number (DIN).

Issuance of summons to firms/company

In case of business entities, which are non-individuals, taxable person can be any entity as defined in section 2(84) of CGST Act, 2017, i.e., any one of the following:

1. a Hindu Undivided Family;
2. a company;
3. a firm;
4. a Limited Liability Partnership;
5. an association of persons or a body of individuals, whether incorporated or not, in India or outside India;
6. any corporation established by or under any Central Act, State Act or Provincial Act or a Government company as defined in clause (45) of section 2 of the Companies Act, 2013;
7. anybody corporate incorporated by or under the laws of a country outside India;
8. a co-operative society registered under any law relating to co-operative societies;
1. a local authority;
10. Central Government or a State Government;
11. society as defined under the Societies Registration Act, 1860;

• trust; and

all. every artificial juridical person, not falling within any of the above;

In case of above entities, since all these are non-individuals and artificial/legal persons, they can’t be present in person. As such, they have to be represented through authorized representative of such entity who could be any one of the following:

1. Managing director/whole time director/executive director
2. Any director
3. Partner
4. Designated partner
5. Key managerial personnel- CEO/CFO/company secretary etc.
6. Trustee/Secretary/President etc. in case of other enterprises.

The issuance of summons requires application of mind and must be based on principles of reasonableness. For ex-where a legal issue is involved, legal officer may be the right person; where accounts are involved, CFO may be the right person and so on. It may not be necessary to summon top management in every summon.

It has been judicially held that summons should be issued only to the concerned person who are expected to have knowledge relating to enquiry. [Refer: Sudhir Deorav CCE 2012 (11) TMI 915 - JHARKHAND HIGH COURT]. The CBEC (now CBIC) had earlier issued guidelines in the pre-GST regime on the same lines.

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