Module 1: Assessment, Demands, and Recovery in GST 🏛️

This module is a cornerstone of GST law, covering the procedures for assessing a taxpayer's
liability and the legal mechanisms for the tax department to enforce collection. It is critical
for a law student to understand not just the 'what' but also the 'why' behind these procedures.

1.1 Self-assessment

 Concept: This is the bedrock of the GST regime. The Central Goods and Services Tax Act,
2017 (CGST Act) places the onus on every registered person to calculate and pay their tax
liability on their own. This is done by filing a periodic return (GSTR-3B).
 Legal Basis: Section 59 of the CGST Act mandates that every registered person shall self-
assess the taxes payable and furnish a return for each tax period. This creates a legal
presumption that the amount declared is correct, until proven otherwise.
 Legal Implications for Law Students: This principle of self-assessment is a paradigm shift
from previous indirect tax laws. It implies that a taxpayer is an 'agent' of the government,
legally entrusted with the duty to collect and remit tax. Any incorrect self-assessment,
whether intentional or not, can be treated as a legal default, leading to actions under Section
73 (non-fraudulent) or Section 74 (fraudulent) of the Act.

1.2 Provisional Assessment

 Concept: A legal recourse for a taxpayer when they are genuinely unable to determine the
value of goods/services or the applicable tax rate. It provides a temporary solution to fulfill
their tax obligation.
 Legal Basis: Section 60 of the CGST Act.
 Procedure:
1. The taxpayer files a written request with the proper officer.
2. The officer, if satisfied, allows payment of tax on a provisional basis.
3. The taxpayer must furnish a bond and a security deposit.
4. The proper officer completes the final assessment within 90 days and issues a final order.
 Legal Aspects: This is a discretionary power of the tax authority. The grant of provisional
assessment creates a legal obligation for the taxpayer to provide an indemnity bond, securing
the provisional amount. The final order is subject to interest payments—if tax is deficient,
interest is paid by the taxpayer; if in excess, by the government.

1.3 Scrutiny of Returns

 Concept: A preliminary non-intrusive method of verification. The proper officer examines

the tax return without the taxpayer being physically present. It is based on system-generated
data and risk parameters.
 Legal Basis: Section 61 of the CGST Act.
 Procedure:
1. The proper officer sends a notice in FORM GST ASMT-10 to the taxpayer, identifying
discrepancies in the filed returns.
2. The taxpayer must respond within a specified period, either correcting the discrepancy or
providing a satisfactory explanation in FORM GST ASMT-11.
3. If the explanation is satisfactory, no further action is taken.
4. If not, the officer can initiate other actions like audit (Section 65), special audit (Section 66),
or a full-fledged investigation (Section 67).
 Significance: This is a crucial procedural step and a first line of defense for the department.
It is an administrative tool, not a legal assessment, but it can trigger legal proceedings.

1.4 Assessment of Non-filers of Returns

 Concept: This is a best judgment assessment conducted by the proper officer when a
registered person fails to file their return.
 Legal Basis: Section 62 of the CGST Act.
 Procedure:
1. The proper officer issues a notice to the non-filer.
2. If the return is not filed within 15 days, the officer proceeds with a best judgment assessment.
3. The order is based on available information, which can include bank statements, e-way bills,
or other records.
4. The order is withdrawn automatically if the taxpayer files the return within 30 days of the
order.
 Legal Ramifications: This is a penal provision. The best judgment assessment order is
legally binding unless the taxpayer takes the corrective action of filing the return. This
provision underscores the mandatory nature of filing returns.

1.5 Assessment of Unregistered Persons

 Concept: This provision targets individuals or businesses who were required to be registered
under GST but failed to do so.
 Legal Basis: Section 63 of the CGST Act.
 Procedure: The proper officer, on discovering that a person liable to register has not done so,
conducts a best judgment assessment based on all information available.
 Key Legal Difference: Unlike Section 62, this provision does not allow for automatic
withdrawal of the order upon subsequent registration. The unregistered person is liable for
tax, interest, and penalties from the date of default.

1.6 Initiation of Recovery Proceedings

 Concept: The legal process by which the tax department recovers unpaid tax, interest, and
penalties.
 Legal Basis: Sections 78, 79, and 80 of the CGST Act.
 Methods of Recovery:
o Attachment and Sale of Property: The proper officer can attach and sell the defaulter's
movable and immovable property.
o Attachment of Bank Accounts: The officer can issue a notice to the bank to freeze the
account and pay the dues.
o Garnishee Order: The department can require any person who owes money to the defaulter
to pay the department directly.
o Detention of Goods: In specific cases, goods in transit can be detained.
 Law Student's Perspective: These are powerful statutory powers. Understanding the
procedural safeguards and limitations on these powers is critical. For example, Section 80
allows for payment in installments, offering a form of relief to the defaulter.

Module 2: Advance Ruling and Revision in GST ⚖️

This module is crucial for understanding the mechanisms of dispute resolution and the
hierarchical appellate structure within the GST framework.

2.1 Authority for Advance Ruling (AAR)

 Concept: An institutional mechanism to provide certainty to taxpayers. An AAR is a judicial

body that issues a binding ruling on specific questions.
 Legal Basis: Section 96 of the CGST Act.
 Purpose: To prevent future litigation and provide clarity on complex tax matters such as:
o Classification of goods or services.

o Applicability of a notification.
o Valuation of supply.
 Binding Nature: The ruling is binding on the applicant and the proper officer but not on
other taxpayers. This limited binding nature is a key legal feature.

2.2 Appellate Authority for Advance Ruling (AAAR)

 Concept: The first appellate forum for a person aggrieved by a ruling of the AAR.
 Legal Basis: Section 99 of the CGST Act.
 Function: It re-examines the AAR's order. The order passed by the AAAR is also binding on
the applicant and the jurisdictional tax authorities.

2.3 Powers of Revisional Authority

 Concept: A suo motu (on its own motion) power of the Commissioner to revise orders
passed by a subordinate officer if the order is deemed erroneous and prejudicial to the
revenue's interest.
 Legal Basis: Section 108 of the CGST Act.
 Key Elements for a Law Student: This is a powerful, non-appellate remedy for the tax
department. The key legal tests are: (1) Is the order erroneous? (2) Does it cause prejudice to
the revenue? Both conditions must be met for the power to be exercised.

2.4 Constitution of Appellate Tribunal and Benches thereof

 Concept: The Goods and Services Tax Appellate Tribunal (GSTAT) is the second level
of appeal, providing a specialized forum for resolving disputes.
 Legal Basis: Section 109 of the CGST Act.
 Significance: It is the final fact-finding body in the GST appellate process. Its rulings are
based on both questions of fact and law. Appeals from the GSTAT are limited to questions of
law.
 2.5 Appeal to High Court

 Concept: The first level of judicial review for a GST dispute. An appeal can be filed against
an order of the GSTAT.
 Legal Basis: Section 117 of the CGST Act.
 Jurisdiction: The High Court can only entertain an appeal if it involves a substantial
question of law. This is a high legal threshold and is often a key point of argument.

2.6 Appeal to Supreme Court

 Concept: The apex court and the final arbiter of a GST dispute.
 Legal Basis: Section 118 of the CGST Act.
 Jurisdiction: An appeal lies from a High Court judgment if the Supreme Court is satisfied
that the case involves a substantial question of law. This completes the judicial hierarchy for
GST matters.

Module 3: Procedure for Assessment in IT (Income Tax) 💰

This module is a deep dive into the assessment process under the Income Tax Act, 1961. A
law student must grasp the distinctions between the various types of assessments.

3.1 Return of Income

 Concept: The statutory obligation of every person to declare their income and tax liability.
 Legal Basis: Section 139 of the Income Tax Act.
 Types of Returns:
o Original Return: Filed within the due date.
o Belated Return: Filed after the due date but before the end of the relevant assessment year.
o Revised Return: Filed to correct an original or belated return.
o Updated Return: A new provision allowing taxpayers to update their return within 24
months of the assessment year's end to declare income they missed earlier, subject to an
additional tax.

3.2 Self-assessment

 Concept: The primary method where the taxpayer calculates and pays their tax liability. This
happens before a return is filed.
 Legal Basis: Section 140A of the Income Tax Act.
 Key Requirement: The tax must be paid, and the return must be filed. Failure to do so can
lead to penalties and interest under Section 234A.

3.3 Assessment

 Concept: The formal process by which the tax department verifies the correctness of the
taxpayer's return and determines the final tax liability.
 Legal Basis: Section 143 and 144 of the Income Tax Act.
 Types of Assessment:
o Summary Assessment (Section 143(1)): A centralized processing of the return without any
human intervention. Adjustments are limited to mathematical errors or obvious discrepancies.
o Scrutiny Assessment (Section 143(3)): A detailed examination of the return to ensure the
assessee has correctly declared all income and claimed no excessive deductions. A notice is
issued under Section 143(2).

3.4 Best Judgment Assessment

 Concept: A legal tool for the Assessing Officer (AO) to assess income based on their best
judgment when the taxpayer fails to cooperate.
 Legal Basis: Section 144 of the Income Tax Act.
 Grounds for a Best Judgment Assessment:
o Failure to file a return under Section 139.

o Failure to comply with a notice under Section 142(1) or 143(2).

o Failure to maintain proper books of accounts.
 Legal Principle: The judgment must not be arbitrary but must be a "fair guess" based on all
available material.

3.5 Reopening of Assessment at the Instance of the Assessee

 Concept: This is a misnomer in the syllabus. It should be understood as the process of re-
assessment by the department.
 Legal Basis: Sections 147 and 148 of the Income Tax Act.
 Correct Interpretation: This refers to the power of the AO to assess or re-assess income
that has escaped assessment. The AO must have "reason to believe" that income has escaped
assessment.

3.6 Income Escaping Assessment

 Concept: The procedure to bring to tax income that was not previously assessed.
 Legal Basis: Section 147 of the Income Tax Act.
 Procedure (New Provisions): The new law is based on a risk management strategy.
Reopening is allowed if the AO has "information" that income has escaped assessment. The
time limits for issuing notice under Section 148 are:
o 3 years from the end of the relevant assessment year for escaped income up to ₹50 lakhs.
o 10 years for escaped income above ₹50 lakhs.

Module 4: Special Procedure for Assessment of Search

Cases in IT 🕵️
This module covers the extraordinary and strict legal framework for assessing undisclosed
income discovered during a search and seizure operation ("raid").

4.1 Assessment of Undisclosed Income as a Result of Search

 Concept: This is a special, expedited assessment for income found during a search.
 Legal Basis: Sections 153A, 153B, and 153C of the Income Tax Act.
 Scope: The AO can assess or re-assess the income for six assessment years immediately
preceding the assessment year of the search. The new law has changed this to ten years in
some cases.
 Key Legal Feature: The search is a powerful investigative tool that allows the department to
circumvent normal procedural limitations and assess income for multiple years.

4.2 Time Limit for Completion of Block Assessment

 Concept: The statutory time limit for completing the assessment under Section 153A.
 Legal Basis: Section 153B of the Income Tax Act.
 Time Limit: The assessment must be completed within 24 months from the end of the
month in which the search was conducted. This time limit is crucial as it ensures a swift
resolution of search cases.

4.3 Dispute Resolution Committee

 Concept: A new mechanism introduced to provide a more collaborative, less formal

alternative to the traditional appellate process.
 Legal Basis: Section 245MA of the Income Tax Act.
 Purpose: To resolve disputes in a time-bound manner, especially for cases where search has
been conducted, and to reduce litigation.

4.4 Procedure on Receipt of Application

 Concept: The steps the Dispute Resolution Committee (DRC) takes after a taxpayer files an
application.
 Key Steps:
1. The DRC will examine the application.
2. It may call for records and provide a hearing to the applicant and the AO.
3. It passes an order that is binding on both the applicant and the department.

4.5 Advance Rulings in IT

 Concept: Similar to GST, the Authority for Advance Rulings (AAR) provides a binding
ruling. However, in Income Tax, the AAR's jurisdiction is more limited, primarily to non-
residents and certain residents for transactions with non-residents.
 Legal Basis: Chapter XIX-B of the Income Tax Act.

4.6 Advance Ruling to be Void in Certain Circumstances

 Concept: An advance ruling, though binding, can be declared void if it was obtained through
fraud or misrepresentation of facts.
 Legal Basis: Section 245Q of the Income Tax Act.
 Legal Consequence: Once an advance ruling is void, all provisions of the Income Tax Act
apply as if the ruling had never been made.
 Module 5: Appeals and Revision in IT 🏛️
This module details the complete judicial and quasi-judicial hierarchy for challenging orders
passed by the Income Tax Department.

5.1 Appealable Orders Before Commissioner (Appeals)

 Concept: The first level of appeal for an aggrieved taxpayer.

 Legal Basis: Section 246A of the Income Tax Act.
 Who Can Appeal: Any assessee who is dissatisfied with an assessment order, penalty order,
or other specific orders passed by the Assessing Officer. The appeal is a crucial right for a
taxpayer.

5.2 Appellate Tribunal

 Concept: The Income Tax Appellate Tribunal (ITAT) is the second level of appeal and a
quasi-judicial body. It is often referred to as the "last fact-finding authority."
 Legal Basis: Section 253 of the Income Tax Act.
 Function: It hears appeals from orders of the Commissioner (Appeals) and certain other
orders. Its orders are binding on the tax authorities but not on the High Courts.

5.3 Appeal to High Court

 Concept: The first level of judicial appeal in the regular court system.
 Legal Basis: Section 260A of the Income Tax Act.
 Jurisdiction: The High Court can only entertain an appeal if it involves a substantial
question of law. This is a key legal filter.

5.4 Appeal to Supreme Court

 Concept: The apex court and the final judicial forum for income tax disputes.
 Legal Basis: Section 261 of the Income Tax Act.
 Jurisdiction: An appeal lies to the Supreme Court from a High Court's judgment on a
substantial question of law.

5.5 Revision of Orders Prejudicial to Revenue

 Concept: A powerful revisional power of the Commissioner to revise an order passed by a

subordinate officer. This is an administrative remedy for the department, not an appeal.
 Legal Basis: Section 263 of the Income Tax Act.
 Conditions: The Commissioner must be satisfied that the subordinate officer's order is both
erroneous and prejudicial to the interests of the revenue. This provision is often a subject
of intense litigation.

MIND MAP
Module 1: Assessment and Demands and Recovery in GST
 This module covers the key procedures for determining tax liability and collecting dues under
the Goods and Services Tax (GST) law. It focuses on how the tax department assesses
taxpayers, identifies non-compliance, and initiates recovery actions.

1.1 Self-assessment

 Concept: This is the primary method of assessment in GST. Every registered person is
required to calculate their own tax liability for a given tax period and pay it, along with filing
a GST return.
 Legal Basis: Section 59 of the Central Goods and Services Tax (CGST) Act, 2017.
 Relevance for Law Students: Understanding the legal obligation of self-assessment is
crucial as it forms the foundation of the GST compliance mechanism. Failure to self-assess
correctly can lead to various legal consequences.

1.2 Provisional Assessment

 Concept: Used when the taxpayer is unable to determine the value of goods or services or the
applicable tax rate. They can request the proper officer to allow them to pay tax on a
provisional basis.
 Legal Basis: Section 60 of the CGST Act.
 Procedure: The taxpayer files a request with the proper officer, who then issues an order for
provisional payment. Once the final tax is determined, a final assessment order is passed, and
any excess or deficit amount is adjusted.

1.3 Scrutiny of Returns

 Concept: A non-intrusive method where a proper officer examines the GST returns and
related details submitted by the taxpayer to verify their correctness.
 Legal Basis: Section 61 of the CGST Act.
 Process: The officer sends a notice (FORM GST ASMT-10) to the taxpayer asking for an
explanation for discrepancies. The taxpayer must respond with explanations and corrections
(FORM GST ASMT-11). If the explanation is satisfactory, the matter is closed; if not, further
action like an audit or investigation may be initiated.

1.4 Assessment of Non-filers of Returns

 Concept: When a registered person fails to furnish a return despite a notice, the proper
officer can assess the tax liability based on the available information.
 Legal Basis: Section 62 of the CGST Act.
 Procedure: A best judgment assessment is made by the officer. The taxpayer can still file the
return within 30 days of the assessment order, and the order will be automatically withdrawn.

1.5 Assessment of Unregistered Persons

 Concept: This applies to persons liable to be registered under GST but who have failed to do
so. The proper officer can determine their tax liability.
 Legal Basis: Section 63 of the CGST Act.
 Procedure: The officer issues a notice and conducts a best judgment assessment based on
available information.
 1.6 Initiation of Recovery Proceedings

 Concept: This involves the legal actions taken by the tax authorities to recover unpaid GST
dues.
 Legal Basis: Sections 78, 79, and 80 of the CGST Act.
 Methods: Recovery can be done through various means, including:
o Attachment and sale of movable or immovable property.

o Attachment of bank accounts.

o Detention of goods.
o Requesting other government departments to recover the amount from the defaulter.

Mind Map for Module 1

Module 2: Advance Ruling and Revision GST

This module delves into the mechanisms for seeking clarification on GST matters and the
hierarchical appeal process within the tax administration.

2.1 Authority for Advance Ruling (AAR)

 Concept: A judicial body constituted under GST law to provide a binding ruling on certain
questions of law or fact to an applicant. This provides certainty and helps avoid future
disputes.
 Legal Basis: Section 96 of the CGST Act.
 Purpose: To clarify tax liability in advance on matters such as the classification of goods or
services, applicability of a notification, or the determination of time and value of supply.

2.2 Appellate Authority for Advance Ruling (AAAR)

 Concept: An appellate body where a person aggrieved by an order of the AAR can file an
appeal.
 Legal Basis: Section 99 of the CGST Act.
 Function: To reconsider the ruling given by the AAR and issue a new, binding decision.

2.3 Powers of Revisional Authority

 Concept: The revisional authority (usually the Commissioner) has the power to examine a
decision or order passed by a subordinate officer and revise it if it is found to be erroneous
and prejudicial to the revenue's interests.
 Legal Basis: Section 108 of the CGST Act.
 Key Aspect: This is a suo motu (on its own motion) power of the Commissioner, not an
appeal filed by the taxpayer.

2.4 Constitution of Appellate Tribunal and Benches thereof

 Concept: The GST Appellate Tribunal (GSTAT) is the second level of appeal for GST
matters, after the Appellate Authority.
 Legal Basis: Section 109 of the CGST Act.
 Significance: It is the last fact-finding authority in the GST appeals process. Orders from the
GSTAT can be challenged only on a question of law before the High Court.

2.5 Appeal to High Court

 Concept: An appeal can be filed with the High Court against an order of the GSTAT, but
only on a substantial question of law.
 Legal Basis: Section 117 of the CGST Act.
 Relevance for Law Students: This highlights the transition from a specialized tax tribunal to
the general judicial system.

2.6 Appeal to Supreme Court

 Concept: An appeal can be filed with the Supreme Court against the High Court's judgment
on a question of law.
 Legal Basis: Section 118 of the CGST Act.
 Significance: This is the highest level of judicial review for GST matters.

Mind Map for Module 2

Module 3: Procedure for Assessment in IT (Income Tax)

This module focuses on the various methods of assessment under the Income Tax Act, 1961,
which is a core part of direct taxation.

3.1 Return of Income

 Concept: A statement of income, expenses, and tax payable filed by a person with the
Income Tax Department.
 Legal Basis: Section 139 of the Income Tax Act.
 Types: Original, belated, revised, and updated returns.

3.2 Self-assessment

 Concept: Same as in GST, this is the primary method where the taxpayer calculates and pays
their tax liability.
 Legal Basis: Section 140A of the Income Tax Act.
 Key Point: The tax must be paid before filing the return.

3.3 Assessment

 Concept: A formal determination of the total income and tax payable by an assessee by the
Assessing Officer (AO).
 Legal Basis: Sections 143 and 144 of the Income Tax Act.
 Relevance: This is the process through which the tax department verifies the accuracy of the
self-assessment.

3.4 Best Judgment Assessment

 Concept: An assessment made by the AO based on their best judgment when the assessee
fails to cooperate or provide necessary information.
 Legal Basis: Section 144 of the Income Tax Act.
 Circumstances: This is done when the taxpayer fails to file a return, does not comply with a
notice, or fails to maintain books of accounts as required.

3.5 Reopening of Assessment at the Instance of the Assessee

 Concept: This part of the syllabus may be a misnomer, as it's typically the department that
reopens an assessment.
 Legal Basis: The new provisions under Sections 147 and 148 of the Income Tax Act.
 Correct Interpretation: This likely refers to the provisions for re-assessment or income
escaping assessment where the AO believes income has not been fully assessed.

3.6 Income Escaping Assessment

 Concept: The process by which the AO re-assesses or assesses income that has not been
correctly declared or taxed in the original assessment.
 Legal Basis: Sections 147 and 148 of the Income Tax Act.
 Key Distinction: The new law distinguishes between "escaped income" below and above
₹50 lakh. The time limits for reopening vary based on the amount.

Mind Map for Module 3

Module 4: Special Procedure for Assessment of Search

Cases in IT
This module covers the unique and specialized legal procedures for assessing income that is
uncovered during a search and seizure operation (a "raid") by the Income Tax Department.

4.1 Assessment of Undisclosed Income as a Result of Search

 Concept: This is a separate, special procedure for assessing the undisclosed income found
during a search. It aims to fast-track the assessment of unaccounted wealth.
 Legal Basis: Sections 153A, 153B, and 153C of the Income Tax Act.
 Scope: The AO can assess or re-assess the income for six assessment years immediately
preceding the assessment year relevant to the search.

4.2 Time Limit for Completion of Block Assessment

 Concept: This refers to the time limit within which the special assessment in a search case
must be completed.
 Legal Basis: Section 153B of the Income Tax Act.
 Key Point: The time limit is generally 24 months from the end of the month in which the
search was conducted. This is a critical procedural safeguard.

4.3 Dispute Resolution Committee

 Concept: A new mechanism introduced to provide an alternative to the regular appeal

process for certain taxpayers, particularly those with search cases.
 Legal Basis: Sections 245MA of the Income Tax Act.
 Purpose: To resolve disputes in a time-bound manner and reduce litigation.

4.4 Procedure on Receipt of Application

 Concept: This refers to the procedural steps the Dispute Resolution Committee must follow
once an application is filed.
 Key Steps: The committee will examine the application, provide a hearing to the applicant,
and pass an order. The order is binding on the applicant and the department.

4.5 Advance Rulings in IT

 Concept: Similar to GST, the Authority for Advance Rulings (AAR) provides a binding
ruling on questions of law or fact to non-residents, residents seeking a transaction with a non-
resident, or certain public sector undertakings.
 Legal Basis: Chapter XIX-B of the Income Tax Act.

4.6 Advance Ruling to be Void in Certain Circumstances

 Concept: The advance ruling, though binding, can be declared void if it is found to have
been obtained by fraud or misrepresentation of facts.
 Legal Basis: Section 245Q of the Income Tax Act.

Mind Map for Module 4

Module 5: Appeals and Revision in IT

This module covers the comprehensive appellate framework under the Income Tax Act,
which allows taxpayers to challenge assessment orders.

5.1 Appealable Orders Before Commissioner (Appeals)

 Concept: The first level of appeal for an aggrieved taxpayer.

 Legal Basis: Section 246A of the Income Tax Act.
 Who Can Appeal: Any assessee who is dissatisfied with an assessment order, penalty order,
or other specified orders passed by the Assessing Officer.

5.2 Appellate Tribunal

 Concept: The Income Tax Appellate Tribunal (ITAT) is the second level of appeal. It is a
quasi-judicial body and is the final fact-finding authority.
 Legal Basis: Section 253 of the Income Tax Act.
 Function: It hears appeals from orders of the Commissioner (Appeals) and certain other
orders of the Commissioner.

5.3 Appeal to High Court

 Concept: An appeal can be filed with the High Court against an order of the ITAT, but only
on a substantial question of law.
 Legal Basis: Section 260A of the Income Tax Act.

5.4 Appeal to Supreme Court

 Concept: The final and highest court of appeal against the High Court's judgment on a
question of law.
 Legal Basis: Section 261 of the Income Tax Act.

5.5 Revision of Orders Prejudicial to Revenue

 Concept: A revisional power of the Commissioner to examine and revise an order passed by
a subordinate officer if it is found to be erroneous and harmful to the interests of the revenue.
 Legal Basis: Section 263 of the Income Tax Act.
 Key Point: This is a powerful tool used by the department to correct errors that result in a
loss of revenue.

Mind Map for Module 5