Context:

Recently, the government has brought the Goods and Services Tax Network (GSTN) under the Prevention of Money-laundering Act (PMLA).

Background:

• The government has brought the Goods and Services Tax Network (GSTN) under the Prevention of Money-laundering Act (PMLA), as per a notification dated July 7.
• The changes have been made for provisions under Section 66 of the PMLA, which provides for the disclosure of information.
  • The Act binds the 15 entities to disclose case information to the ED if the probe falls under its jurisdiction, as per Section 66.
  • Based on the information, the ED can file a case under the PMLA, if it deems fit.
• The notification by Finance Ministry has amended an earlier 2006 notification that will facilitate sharing of information between the GSTN, Enforcement Directorate and other investigative agencies.

About Goods and Services Tax Network (GSTN):

• Establishment: 2013
• HQ: New Delhi.
• It is a not for profit, non-Government, private limited company incorporated in 2013.
• Objective: The company primarily provides IT infrastructure and services to the Central and State Governments, taxpayers, and other stakeholders for the implementation of the Goods and Services Tax (GST).

• Shareholding: The Government of India holds 5%equity in GSTN.
• GSTN provides a strong IT Infrastructure and Service backbone which enables the capture, processing and exchange of information amongst the stakeholders (including taxpayers, States and Central Governments, Accounting Offices, Banks and RBI.

 Mission of GSTN:

• Provide common and shared IT infrastructure and services to the Central and State Governments, Tax Payers and other stakeholders for implementation of the Goods & Services Tax (GST).
• Provide common Registration, Return and Payment services to the Taxpayers.
• Partner with other agencies for creating an efficient and user-friendly GST Eco-system.
• Encourage and collaborate with GST Suvidha Providers (GSPs) to roll out GST Applications for providing simplified services to the stakeholders.
• Carry out research, study best practices and provide Training and Consultancy to the Tax authorities and other stakeholders.
• Provide efficient Backend Services to the Tax Departments of the Central and State Governments on request.
• Develop Tax Payer Profiling Utility (TPU) for Central and State Tax Administration.
• Assist Tax authorities in improving Tax compliance and transparency of the Tax Administration system.
• Deliver any other services of relevance to the Central and State Governments and other stakeholders on request.

 Prevention of Money-laundering Act (PMLA), 2002

• It was enacted in
• It came into force with effect from 1st July 2005.
• The Parliament enacted the PMLA as a result of international commitment to sternly deal with the menace of money laundering.
• Applicability: The PMLA is applicable to all persons which include individuals, companies, firms, partnership firms, associations of persons or incorporations and any agency, office or branch owned or controlled by any of the above-mentioned persons.

Objectives of PMLA:

• To prevent and control money laundering.
• To confiscate and seize the property obtained from the laundered money.
• To deal with any other issue connected with money laundering in India.

 Provisions of PMLA,2002:

• Definition of money laundering: 3 of PMLA defines the offence of money laundering
• Prescribed obligation: PMLA prescribes the obligation of banking companies, financial institutions and intermediaries to verification and maintenance of records of the identity of all its clients and also of all transactions and for furnishing information of such transactions in a prescribed form to the Financial Intelligence Unit-India (FIU-IND).

Empowerment of officers:

• PMLA empowers certain officers of the Directorate of Enforcement to carry out investigations in cases involving the offence of money laundering and also to attach the property involved in money laundering.
• It empowers the Director of FIU-IND to impose fines on banking companies, financial institutions or intermediaries if they or any of its officers fail to comply with the provisions of the Act as indicated above.

Setting up of Authority:

• PMLA envisages the setting up of an Adjudicating Authority to exercise jurisdiction, power and authority conferred by it essentially to confirm attachment or order confiscation of attached properties.
• It also envisages the setting up of an Appellate Tribunal to hear appeals against the order of the Adjudicating Authority and the authorities like Director FIU-IND.

Special Courts:

• The authorities envisage designating one or more courts of sessions as Special Courts or Special Courts to try the offenses punishable under PMLA and offenses for which the accused can be charged at the same trial under the Code of Criminal Procedure 1973.

FAQs about Goods and Services Tax Network (GSTN)

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