Union of India directed to issue advisory for electronic Document Identification Number system implementation across states

The SC disposed of the writ petition by directing the Union of India/GST Council to issue advisory/instructions/recommendations to respective states regarding implementation of electronic (digital) generation of Document Identification Number (DIN) system for all communications from state tax officers to taxpayers. The court held that implementing DIN system would serve larger public interest and enhance good governance by bringing transparency and accountability in indirect tax administration. The GST Council was empowered under Article 279A to make such recommendations to states, with Karnataka and Kerala already implementing the system.

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Issues:
Implementation of electronic Document Identification Number (DIN) system for tax communications, GST Council's role in recommending DIN system implementation by states.

Analysis:
The petitioner, a Chartered Accountant, filed a Writ Petition under Article 32 seeking the implementation of an electronic DIN system for tax communications to enhance transparency and accountability in indirect tax administration. The petitioner urged the GST Council to consider and decide on implementing the DIN system across all states. The petitioner highlighted the importance of preventing abuse by Departmental Officers through pre-dating communications and ratifying actions. Reference was made to the Prime Minister's directive to ensure honest taxpayers are not harassed, leading to the Central Government's decision to implement the DIN system for CBDT communications.

The respondent, representing the Union of India, acknowledged the benefits of implementing an electronic DIN system for tax communications to enhance transparency and accountability. It was noted that the Central Government had already implemented the DIN system for CBDT communications. However, the responsibility for implementing the DIN system for state tax communications lies with the respective states. The respondent highlighted that the GST Council has the authority to recommend and advise states on matters related to GST, including the implementation of the DIN system.

The Supreme Court recognized the public interest and governance benefits of implementing the electronic DIN system for tax communications. While appreciating the efforts of Karnataka and Kerala for already implementing the system, the Court emphasized the importance of extending this practice nationwide. The Court directed the Union of India and the GST Council to issue advisories to states for implementing the electronic DIN system, emphasizing transparency and accountability in indirect tax administration. The concerned states were urged to consider implementing the DIN system promptly to enhance governance. The Court disposed of the writ petition, instructing the Registry to send a copy of the order to the Chief Secretary of all respondent states for necessary action.

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