If you hold money for or on account of a defaulter, the taxman can knock your doors too for recovery

If you hold money for or on account of a defaulter, the taxman can knock your doors too for recovery

SECTION 11 of the CEA, 1944 is being amended so as to provide for -

(i) Recovery of money due to the Government from any person other than from whom money is due after
giving a proper notice, if that other person holds money for or on account of the first person;

(ii) The other person to whom such notice has been issued is bound to comply and

(iii) If the other person to whom the notice is served fails to comply, he shall face all the consequences under this Act.

Section 142 of the Customs Act, 1962 also being amended in like terms.

All the above is sought to be incorporated through clauses 69 and 80 of the Finance Bill, 2013.

It appears that similar provisions carved as section 87 of the Finance Act, 1994 by the Finance Act, 2006 for recovery of Service Tax dues have been fruitful and so the Central Government wants to replicate the same in the matter of recovery of Central Excise & Customs dues.

As Franklin D.Roosevelt mentioned in his speech on October, 21, 1936 -

Taxes, after all, are dues that we pay for the privileges of membership in an organized society.