Creation of New All

India Service-
Indian Revenue
Service

Report by Committee

comprising of

1. Mr. Vinayak Chandra Gupta Commissioner and

Chairman
2. Mr. Saurabh Kumar - Dy Commissioner and
Member
3. Mr. Anish Upadhyay- Asst. Commissioner
and Member
4. Mr. Ashok Bishnoi- Asst. Commissioner
and Member

1
 INDEX

SL NO CONTENTS PAGE
NO
1 Rational behind creation of All India Services 4
2 Why do we need All India Service for GST? 5
2(i) One nation-One TaxOne Administration 5
2(ii) Co-ordination 7
2(iii) Sharing of best practices 7
2(iv) Countering Tax Evasion 7
2(v) Inclusive GST and ease of doing business 7
3 Positives from the IRS(C&CE)s perspective 8
3(i) Better Career Progression 9
3(ii) No parity issue with VAT officers 9
3(iii) Parity with IAS and IPS 10
3(iv) Better Infrastructure 10
3(v) Closer interaction with Political leaders/elected representatives 10
3(vi) Greater interaction with other Departments 11
3(vii) Diversity of work 11
3(viii) Disparity in administrative set up addressed 11
3(ix) Advantage of staying in one state 12
3(x) Seamless flow of Personnel between SGST & CGST 12
4 Negatives from IRS(C&CE)s perspective 12
4(i) Political interference 12
4(ii) Postings in small towns 13
4(iii) Allotment of state cadres for already serving IRS C&CE 13
4(iv) Having to work in the Vernacular language 13
4(v) Fear of subordination to IAS 14
5 Benefits from VAT officers perspective 14
5(i) Better Career Progression 14
5(ii) Diversity of work 14
5(iii) Disparity in administrative set up addressed 15
5(iv) Advantage of posting to other States 15
5(v) Seamless flow of Personnel between SGST & CGST 15
6 Benefits from CBEC Group B officers perspective 15

2
6(i) Better Career Progression 15
6(ii) Disparity in administrative set up addressed 16
6(iii) Advantage of staying in one state 16
6(iv) Seamless flow of Personnel between SGST & CGST 16
6(v) Conversion of Temporary Assistant Commissioner to 17
Permanent Cadre post
7 Legal provisions for making IRS(C&CE) from Central 17
Service to All India Service
7(i) Treatment of CBEC in All India Service scenario, CBEC to be 17
notified as Joint Cadre
7(ii) Treatment of Senior Duty Posts of Customs and CBN 18
department in AIS scenario
7(iii) Cadre Controlling Authorities for the IRS 20
7(iv) Fresh Recruitment for IRS 21
7(v) Promotion to IRS 21
7(vi) Cadre Allocation of existing officers of IRS(C&CE) to IRS in AIS 22
scenario
7(vii) Steps required for making IRS(C&CE) from Central Services Gr 22
A to AIS

3
 1. Rational behind creation of All India Services

When our nation got independence from British Raj, the question of future of
bureaucracy and then Indian Civil Service (ICS) was discussed in detail in
constituent assembly and after many discussions they arrived at conclusion that
Services are not only necessary but also they should be more Indianised to serve the
needs of newly emerged democracy, hence they decided to create All India Services
like IAS and IPS. The following were the broad objectives of the Constitution-
framers in providing for the scheme of All India Services, common to the Union and
the States:-

a) Preserving national unity and integrity and uniform standards of

administration.
b) Neutrality and objectivity- non-political, secular and non-sectarian
outlook.
c) Competence, efficiency and professionalism at entry level by attracting the
best and the brightest, throughout the career.
d) Facilitating liaison between the Union and the States;
e) Ensuring a certain uniformity in standards of administration;
f) Enabling the administrative machinery at the Union level to keep in touch
with realities at the field in the States;
g) Helping State administrative machinery to acquire a wider outlook and
obtain the best possible talent for its senior posts; and
h) Ensuring that political considerations either in recruitment or in discipline
and control are reduced to the minimum, if not eliminated altogether.

The First Administrative Reforms Commission Study Team on Centre-State Relationships

was of the view that the main objectives underlying the All India Services remain
valid. These objectives briefly are:

(i) All India recruitment makes possible a minimum and uniform standard of
administration throughout the country. It enables the induction of the best
available talent into these services.
(ii) With personnel drawn from different States, each State cadre gets a
leavening of senior officers from outside whose vision and outlook
transcend local horizons.

4
 (iii) A systematic deputation from the States to the Union broadens the vision
of the officers so deputed and brings to the Union and experience close to
actual realities.
(iv) The joint control of these officers by the States and the Union Government,
with the latter having ultimate authority over them, provides a measures
of remote control which, being more objective, enables officers to
withstand local influence and to provide independent advice.

2. Why do we need All India Service for GST or Indirect

Taxes of India?

i) One nation-One TaxOne Administration

After 1991 economic reforms, our goal was shifted from Control of Business
and trade to facilitation of trade and business. In 1991 we have made clear that our
goal is to integrate our economy with world economy for prosperity of India and
World. We have done away with most of the controls and regulations after that. We
have improved our ranking much in ease of doing business index since 1991. Our
integration with world economy has brought fruits to our nation and today we are
worlds 6th largest economy in terms of nominal GDP. We are on historical path of
making India a single market by entering into Goods and Services Tax reform. The
policies of present government for promotion of Make in India and removal of
hurdles from doing business, has been resulted in more foreign direct investment
coming in India from various corners of the world. India received $44.20bn as FDI in
2015 which was more than China and US. More and more MNCs are coming to India
and proving and creating job opportunities here. To conduct business smoothly,
MNCs need a transparent, competent and uniform tax administration all over India,
whether it is State or Centre.

Till now, States and Centre were/ are levying different indirect taxes on
manufacture & sale of commodities as well as on services. Indirect taxation of Centre
and States have different set of statues, different tax base, different set of tax payers
and different taxable events. After 122nd Constitutional Amendment, multiplicity of
indirect taxes of States and Centre are getting merged to a single tax known as GST.
GST being landmark and single largest indirect tax reform since independence, it is
not only bringing concept of One Nation One Tax, but also bring common taxation
Statue, common tax payer, common taxable event and common tax base both for
Centre as well States. Only major issue remains in GST which is going to be

5
unavoidable due to federal structure of our Nation is its implementation and
collection machinery. It is bound to be of multiple authorities i.e on one side, it is
CBEC for Centre while on other side, it is different VAT department of each State
Government.

Unique federal structure of our country and at the same time GST being One
Nation-One Tax, in order to make it successful as it has been envisaged, it is
essential that there should be intimate coordination among the taxation authorities
of Centre as well as all States for seamless GST implementation.

No coordination or inordinate coordination would not only be detrimental

to tax collection both for States as well as Centre but also will lead to abnormal rise
in tax dispute due to different interpretation of same provision of tax statutes by
different tax authorities. (Level of difference in expertise, seniority and
professionalism in CESTAT and State counterparts is well discussed and can be
elaborated, why nation pay price because of tax disputes)

Difference between definition of goods and service getting narrowed down in

GST, uniform and cogent interpretation of GST law is essential by different tax
authorities throughout India not only to ensure that due and correct Tax (SGST)
should accrue to legally deserving State but also to avoid unnecessary litigation
between State to State &/ or State to Centre

Similar administrative machinery throughout the country, Centre as well as

all States will give a real meaning to the bottom line, ONE NATION,ONE TAX,
when administered by ONE SERVICE.

The idea of single control (interface for assesses) has been at the core of the
implementation of GST (and ease of doing Business). The conversion of IRS(C&CE)
into AIS is the only way of practically achieving the goal of single control and to
avoid the pitfalls of dual administration. The present vertical Division of assessees in
the ratio of 50:50 for those having a turnover of more than Rs. 1.5 Cr and 10:90 for
those having a turnover of less than Rs. 1.5 Cr can only be administered without any
hassles only if the top administration is manned by AIS.

The vertical division of assesses at the end of a fixed time period say 3 years
presumes that each administration (State and Central) starts with a clean slate every
3 years whereas in reality at the end of the fixed time period matters such as
adjudication, scrutiny, audit and enforcement cases etc. would be at various stages
of progress and there cannot be a water-tight division of assesses on the basis of
clear-cut time line. Thus there is bound to have interaction between the State and
Central tax administrations vis-a-vis assessee which can take place smoothly only if

6
the tax administration at the top are manned by same service personnel i.e. an AIS
officer.

ii) Co-ordination:

The officers drawn from the same service (AIS) serving on the Central as well
as the State side of GST would lead to better co-ordination as each would be familiar
with the officer on the other side.

iii) Sharing of best practices:

Since the officers would be rotated between the State and Central
Administrations best practices can be shared and implemented between the Central
and State administrations with the CBEC and NACEN acting as the repository of
such knowledge.

iv) Countering Tax Evasion:

Increasing day to day complex trade transactions involving tracking of

information including trail of money not only within country but also internationally
will not only require tax administration to be led by professional expertise in
taxation but also close co-ordination with central tax authorities.

Different modus operandi adopted by tax evaders and unscrupulous

elements will become more complex and more innovative in times to come. It will
not be difficult to repeat Missing Trader Fraud, Carousel Fraud, Contra Trading etc
in Indian Taxation System if real time sharing of information and best practices
between Centre and State administration does not starts with advent of GST. Post
GST, New Modus operandi so developed will impact not only Central Tax but also
State Tax.

In this Context need of special agencies having all India character and
mandate, manned by officers who have experiences in handling both Central and
State tax administration will arise. To curb organized loot of the country, All India
cadre of Tax Administrators is needed. Parallel can be drawn from NIA, CBI, IB,
NCTC and NATGRID; all agencies having all India character and lead by officers
drawn from AIS.

Weakening Centre in this regard means to promotion of tax evaders and

Money launderers. Like terrorism and Tax evasion is also an organized crime and
Nation should develop and strengthen the capabilities of Institutions countering the
menace.
7
v) Inclusive GST and ease of doing business:

It is to be observed that the Taxation of Services is completely new to States

tax authorities and Central tax authorities have developed an expertise in Taxation
of Services over past 22 years. Therefore it makes sense to bring experienced Central
tax officers in state tax administration i.e. IRS.

Complexities have been already represented by various sectors like banks,

insurance, civil aviation, and railways before GST Council as well as before CBEC.
NASSCOM has been very vociferous on the issue and has brought out in detail as to
how single registration will facilitate Government vision of MAKE IN INDIA and
unhindered growth of Indias IT & ITeS Industry. As per various arguments put
forth by NASSCOM, multiple registrations and multiple return filing will impede
PMs goal of Digital India and Start-up India. Single Registration for these sectors at
later stages may be explored to improve ease of doing business.

Further it will be easy to bring all excluded set of sectors into GST because
with trust / authority of state government on tax administrators in Post GST AIS
kind of admin architecture will improve.

Indias ranking in Ease of Doing Business is bound to suffer if roll out of GST
is not smooth because of these provisions. If same Service officers are manning both
Central and State GST tax administrations, it will be easy to achieve coherence in
future and explore such business friendly measures.

Thus in order to address aforesaid foreseen challenges which is just

illustrative, it is essential that Tax administration of States as well as Centre should
be headed by Taxation experts having Pan-India presence, experience and
acceptability in tax administration and this can be done none other than by
IRS(C&CE) officers.

Practically, a close and seamless coordination among SGST, CGST, IGST and
Customs authorities as well as uniform applicability of law cannot be
institutionalized unless both tax administrations are headed by same service
personnel. This goal can be only be achieved by making IRS(C&CE) as ALL INDIA
SERVICE (AIS)

3. POSITIVES FROM IRS(C&CE)s PERSPECTIVE:

8
i) Better Career Progression:

Officers will get faster promotions as the State governments are not as rule-
bound as the Central government. Timely promotions are given by
upgrading/downgrading of posts or creation of ex-cadre posts easily. In the case of
the IPS, it is being felt relevant to reproduce Note 1 to IPS (Pay) Rules, 2016:
Note 1. Appointment of a member of the Service to the Senior Time Scale and above shall be
regulated as per the provisions in the Guidelines regarding promotion to various grades in the Indian
Police Service and any member of service shall be eligible for appointment to the Senior Time Scale on
his completion of four years of service, subject to the provisions of sub-rule 2 of rule 6A of the
Indian Police Service (Recruitment) Rules, 1954, to the Junior Administrative Grade on
completion of nine years of service, to the Selection Grade on completion of thirteen years of service,
to the Deputy Inspector General (Super Time Scale) on completion of fourteen years of service and to
the Inspector General (Super Time Scale) on completion of eighteen years of service.
Therefore, in states it becomes mandatory upon a state Government to accord
the pay Selection grade and Super Time Scale on completion of fixed number of
years of service. Presently 1994 batch of IPS has been empanelled for holding the
post of JS and equivalent in GoI and empanelment of 1995 and 1996 batch is in
process.

By AIS, service will initially get about 250+ posts in the SAG and above in state
Government which will immediately address promotional aspect of officers of all
grades. This will lead to increased number of post at HAG, HAG+ and Apex grade
for the Service and hence better promotional avenue. The service may get one Pr.
Secretary level post in each State Government. (IFS and IPS are holding this post in
several states)

ii) No parity issue with VAT officers:

AIS is placed clearly on a higher pedestal as compared to the Service recruited

through the State Public Service Commissions and are clearly superior to them in
terms of the duties assigned to them and span of their control.

It is being felt necessary to reproduce relevant sections of IAS (Appointment by

promotion) Regulations, 1955

5(2) The Committee shall consider for inclusion to the said list, the cases of members of the
State Civil Services in the order of a seniority in that service of a number which is equal to
three times the number referred in sub-regulation (1).

Provided that such restriction shall not apply in respect of a State where the total number of
eligible officers is less than three times the maximum permissible size of the Select List and in
such a case the Committee shall consider all the eligible officers.

9
 Provided further that in computing the number for inclusion in the field of consideration, the
number of officers referred to in sub-regulation (3) shall be excluded.

Provided also that the Committee shall not consider the case of a member of the State Civil
Service unless, on the first day of January of the year for which the Select List is prepared he
is substantive in the State Civil Service and has completed not less than eight years of
continuous service (whether officiating or substantive) in the post of Deputy Collector or in
any other post or posts declared equivalent thereto by the State Government.

Similar regulations are there for other All India Services also. In one stroke, issues
associated with parity and dignity of constitutional body like UPSC is addressed.

iii) Parity with IAS and IPS:-

7th CPC has recommended for parity in empanelment and pay among All
India services and most likely that will be accepted. AIS definitely give an edge over
Central Group A Services.

iv) Better Infrastructure:

All India Service Officers are having better infrastructural support vis-a-vis
Central Service officers viz vehicles, office infrastructure and support staff. Also, the
State Governments are having land bank of their own, where creation of
infrastructure is easier. They are spared of normal hassle of purchase of land which
itself take several years in the case of the Central government.
CBEC and CBDT are officer oriented and technology driven organization while
most of the State Governments are bottom heavy. Further, the state governments
recruit a large number of staff at the Class-III and Class-IV levels as a way of meeting
their social obligation of providing employment opportunities in their respective
states.

v) Closer interaction with Political leaders/elected representatives:

India is a democratic republic and its people represent themselves by elected

representatives who run the government on their behalf. It would be advantageous
to work closely with elected representatives who are connected to the grass roots as
they have to face the electorate every 5 years. Also, many state level political leaders
move to National scene to play greater roles in the later part of their careers. They
would definitely prefer to work with officers with whom they were already familiar
with during their stint in state politics. In this regard the IAS/IPS has a distinct
advantage over Central services such as ours. All India Service officers exposure to
political leadership in their stint from initial years of their posting at smaller place

10
in State administration makes them more mature in their career growth vis-a-vis an
officer of Central Service.
Till now, in almost all states tax administration is generally headed by an IAS
officer who is a generalist officer. He actually never have planned or formulated the
complex tax laws and policies. He do not know that how indirect taxes affect
financial health of state and centre. IRS as AIS will provide specialist advice to govt.
and their expertise in indirect taxation will surely benefit state and centre. Tax
Policies formed by Specialists IRS officers will be of uniform nature across the states
and centre both. That will lead to minimum or zero contradiction or collusion of
provisions across the nation for all Indirect Taxes. National Academy of Customs,
Excise and Narcotics (NACEN) will serve as apex training institute for indirect tax
officers of India and will also work as think tank for future tax reforms and policies.
The political executive of India will have one more premier service at their
disposal and they will be happy to have one more highly efficient premier service to
accomplish their ultimate objective i.e. welfare and development of the people of
their state. Already our service officers are sought after, when it comes to Central
Deputation. Whichever ministry our service officers had worked, they have excelled
and they are in demands for their competency and work ethics. Unfortunately this
demand evaporates at JS level for reasons best known to all and is well documented
in various pay commission and 2nd ARC reports.
It must be noted that whenever there is centre state turf war, IAS officer in
general try to stay away from getting involved into it rather as a service they project
themselves as coordinator between Centre and State Governments. We, as a service
cant ignore this fact that more we try to stay away from true democracy i.e. political
power centre, more as a service we may lose our focus, meaningful relevance and
contribution at different level to building up our society, state and nation.

vi) Greater interaction with other Departments:

In the state, there is close interaction among various state government

departments which would expose service members to new ideas and opportunities.
At present due to nature of our service, most of us have become used to working in
silos of our own without interaction with other state governmental agencies and
therefore have made us aloof hampering our objective either on organizational level
or personal level. Even during enforcement activities of taxation requires close
interaction with State Police and State administration.

vii) Diversity of work:

11
 Invariably all the AIS officers even from specialist service like the IPS, are
posted to state PSUs/undertakings at some point of their career even without having
to apply for them. Deputations to other departments in State Government will
improve exposure of our officers and also lead to immense service satisfaction.

viii) Disparity in administrative set up addressed:

Present administrative set up for Centre GST taxation and State GST taxation are
different and bound to create heartburn both for Central and State Tax authority.
With tax administrative set up led by AIS officers of same service will make it
possible to address disparity in tax administrative set-up. This will also lead to
obviate confusion to the trade and industry, the most important stakeholder of GST.

ix) Advantage of staying in one state:

During a career in our service we would have come across many instances
where the senior officers had to leave behind their families in large cities like
Delhi/Mumbai and had been posted throughout the country. In an AIS Service, one
is sure that he/she would be posted in the state capital of ones cadre and hence
his/her family would face the least disturbance.

x) Seamless flow of Personnel between SGST & CGST:

From the state VAT officers perspective opportunities for deputation would
open up for them in Central organizations such as the Customs/Enforcement
Directorate/NCB/CBN/DRI etc which at this time are closed for them, while at the
same time it would give an opportunity for officers of CBEC to work in the State tax
administration, thereby enriching officers on both sides in terms of knowledge and
experience.

4. NEGATIVES FROM IRS(C&CE)s PERSPECTIVE:

i) Political interference:

This issue has been discussed at point no. 4 under the section POSITIVES
FROM THE OFFICERS PERSPECTIVE. As already discussed, greater interaction
with elected representatives can be seen both positively as well as negatively due to
the reasons as discussed above.

12
 It is a well-known fact that most of us has given 1st preference to IAS,
knowing that we will get political interference in our work means we were ready for
political interference when we appeared for CSE. It must be noted that the IAS and
IPS officers also suffer from this problem of lack of functional autonomy and
political interference. However, all said and done, we must admit that their closeness
to elected representatives has brought many advantages to their services. Since the
administration of the State Government is more person centric and today many
states in our country are headed by dynamic Chief Ministers, officers of our Service
may get important assignments in administrative set up only being part of an AIS.

ii) Postings in small towns:

Till recently one of the perceived advantages of a Central service like ours
over the All India Services has been that most of the postings in our service are in
urban areas. However now a day this argument is not necessarily true. With every
cadre restructuring, new Commissionerates had been created in many Class B/Class
C stations where Commissioner-rank officers have been posted. For example-
Aurangabad (Maharashtra), Wardha (MH), Jodhpur (Raj.), Alwar (Raj.), Bharuch
(Guj.), Bokaro (Jharkhand) etc. Further, the new privately-owned ports that are
being developed are in very remote locations owning to cheaper availability of land.
Also, it is a distinct possibility that postings at such Class B/ Class C stations
would be upgraded in rank with every cadre restructuring. As compared to this
scenario the postings on in the AIS at senior levels is mostly at the state capitals
Many postings in Customs are in border areas only i.e. Petrapole (WB),
Jogbani (Bihar), Nauthanwa (U.P.) and after each cadre restructuring, higher officers
will be pushed to Country side in leaps due to increasing economic activities in
smaller towns. Even today we have our Central Excise and Service Tax Division
offices in almost each and every moderate district having population more than 10
lakh.

iii) Allotment of state cadres for already serving IRS C&CE:

Though new recruits would come with a mindset that they may be allotted a
cadre which may not be to their liking, the already serving IRS(C&CE) officers will
also be allotted Cadres as per their options for Cadres vis--vis inter-se seniority. In
order to address dissatisfaction of an office in allotment of his Cadre, one may be
given option to work on deputation to the Cadre of ones choice or Central Cadre

13
deputation of Customs or CBN as per detailed guidelines to be framed in this
regard. For this one time relaxation needs to be provided.

iv) Having to work in the Vernacular language:

The Administration of GST will rely heavily upon the English language since
the IT platforms and the Acts would make use of English predominantly.
Like many of our counterparts in IAS and IPS are already working in
vernacular languages in all states. Similarly we will also learn one more Indian
language, which will give a chance to know and appreciate that state and their
culture in better manner, that will further contribute into unifying the nation.

v) Fear of subordination to IAS:

Undoubtedly the IAS holds a great sway in the State government

administration by virtue of the postings in positions of advantages such as Chief
Secretary, Principal Secretary/Secretary of different Ministries and departments of
State Government. However, since Tax collection is a highly specialized job, it would
be reasonable to expect that the officers from our service would maintain their
importance in the state administration and contribute positively and may be even
carve out new domains for themselves such as in state excise, financial head of state
undertakings etc. It must be highlighted that public finance is the lifeblood of public
administration. Even in Central Government, Central Services have been able to get
hardly few deputation posts in the rank of JS and above. There also IAS as a service
plays a dominant role. This is mainly due to political support to IAS as a service.

5. BENEFITS FROM VAT OFFICERS PERSPECTIVE:

i) Better Career Progression:

Senior Duty posts created for IRS officers in each State Cadre should be over
and above existing cadre posts of VAT officers in that State. These Senior Duty posts
should be filled up initially only in partial manner by diversion of existing officers of
IRS(C&CE) and balance should be filled up in staggered manner over a period a few
years either by promotion or regular recruitment, as the case may be.

14
 This will ensure that whole process will not affect VAT officers promotional
avenue available at present in their respective state cadre. Further they will get
additional promotional posts equal to 1/3rd of Senior Duty posts created for IRS
officers. Promotion of State VAT officials to these posts as IRS would be in similar
manner as being allowed to PCS and State PS officials for promotion to IAS and IPS
respectively. Hence there will be better promotion, opportunities and satisfaction.

ii) Diversity of work:

VAT officers, after being promoted to IRS, will get equal opportunities to
work on deputation. Invariably all the AIS officers even from specialist services like
the IPS/IFoS are posted to state PSUs/undertakings at some point of their career
even without having to apply for them. Deputations to other departments in State
Government will improve exposure of our offices and also lead to immense service
satisfaction.
Not only will that it open for them for deputation to other Central
Government ministries, organization viz. ED, NCB as well as Customs.

iii) Disparity in administrative set up addressed:

Present administrative set up for Centre GST taxation and State GST taxation are
different and bound to create heartburn both for Central and State Tax authority.
With tax administrative set up led by IRS officers will make it possible to address
disparity in tax administrative set-up. This will also lead to obviate confusion to the
trade and industry, the most important stakeholder of GST.

iv) Advantage of posting to other States:

VAT officers, after being promoted to IRS, will get equal opportunities to work
in other States on deputation. Many officers children are either studying or posted in
another states, and being part of IRS, an AIS Service, one is sure that he/she may be
posted in other states of his requirement on deputation and hence his/her family
would face the least disturbance.

v) Seamless flow of Personnel between SGST & CGST:

From the state VAT officers perspective opportunities for deputation would
open up for them in CBEC & other Central organizations such as the
Customs/Enforcement Directorate/NCB/CBN/DRI etc which at this time are closed
for them, while at the same time it would give an opportunity for officers of CBEC to

15
work in the State tax administration, thereby enriching officers on both sides in
terms of knowledge and experience

6. BENEFITS FROM CBEC Group B OFFICERS

PERSPECTIVE:

i) Better Career Progression:

At present Group B officers of CBEC have poor promotional aspect as

compared to the promotional avenue available to VAT officers in the State. The
promotion of Group B officers of CBEC to the post of Assistant Commissioner is
linked to vacancy and limited to the extent of 50:50 ratio i.e. 50% by direct recruit
and 50% by promotion for a year. Once IRS is made All India Service and GST cadre
of CBEC is made a Joint Cadre, the formula of promotion in the ratio of 50:50 will go.
In such scenario, promotion from Group B of CBEC to Assistant Commissioner has
to be governed by separate Promotion Rules, which are to be framed somewhat in
line with Promotion Rules of State VAT Cadres. This will definitely lead to better
promotional aspect of Group B officers of CBEC.

Further Group B officers of CBEC will get additional promotional posts equal
to 1/3rd
of Senior Duty posts created for IRS officers in CBEC cadre. Their promotion
as IRS like State VAT officials would be in similar manner as being allowed to PCS
and State PS officials for promotion to IAS and IPS respectively. Hence there will be
better promotion, opportunities and satisfaction Group B officers of CBEC.

ii) Disparity in administrative set up addressed:

Present administrative set up for Centre GST taxation and State GST taxation are
different and bound to create heartburn both for Central and State Tax authority.
With tax administrative set up led by IRS officers both at centre and States will make
it possible to address disparity in tax administrative set-up. This will also lead to
obviate confusion to the trade and industry, the most important stakeholder of GST.

iii) Advantage of staying in one state:

During a career in our service we would have come across many instances
where the officers had to leave behind their families in their earlier place of posting.
Once Group B officers are promoted to Group A and have been posted to other part
of the country. In an AIS Service scenario, they can seek deputation from CBEC

16
cadre to State Cadre and may continue themselves in the same place / State. Hence
his/her family would face the least disturbance. Also deputation to other
departments in State Government will improve exposure of the officers and may
also lead to immense service satisfaction.

iv) Seamless flow of Personnel between SGST & CGST:

From the state VAT officers perspective opportunities for deputation would
open up for them in Central organizations such as the Customs/Enforcement
Directorate/NCB/CBN/DRI etc which at this time are closed for them, while at the
same time it would give an opportunity for officers of CBEC to work in the State tax
administration, thereby enriching officers on both sides in terms of knowledge and
experience.

v) Conversion of Temporary Assistant Commissioner to Permanent Cadre

post:

At present there is 2118 post of Assistant commissioner created on temporary

basis for a period of 5 year. With creation of All India Service for IRS and posting of
existing officers of IRS(C&CE) to State Cadres, there will be substantial vacancy at
Assistant commissioner and higher level and this will lead to faster promotion of
CBEC Group B officer. As most of senior Group B officers are already drawing pay
of grade of Assistant commissioner, and promotion of Assistant commissioner not
linked to IRS, these 2118 temporary post may be converted to permanent Cadre
posts.

7. Legal Provisions For Making IRS(C&CE) From Central

Service To All India Service

i) Treatment of CBEC in All India Service scenario, CBEC to be notified as Joint

Cadre

As we know that CBEC has to administer Central component of GST

taxation on pan India basis and its contribution to GST revenue collection to the
national exchequer will be 50% of total GST revenue collection, while balance 50% of
the GST revenue will be collected by all the States put together. Thus GST workforce
of CBEC has to be largest among all the work force of indirect tax administration
putting Centre and States together. Therefore in All India Service scenario, largest

17
chunk of IRS officers out of all IRS cadres of Center and States put together has to be
deployed for GST administration in CBEC.
Now question will arise about modality of placing IRS officers in CBEC as
CBEC is only a wing of one of the department of Central Government. In All India
Service, all cadre officers are placed with different Cadres whether State Cadre or
Joint Cadre and they are placed with different ministries, department etc of Central
Government on deputation basis. For that purpose, certain percentage of Senior
Duty Posts (40% in case of IAS & IPS & 20% in case of IFS) is earmarked as Central
deputation Reserve as per respective Service (Fixation of Cadre Strength)
Regulation.
In so far as IRS as All India Service, Senior Duty Posts of GST
administration of CBEC constituting major chunk of total combined cadre strength
of IRS, keeping the same provisions for IRS also as that of other three AIS i.e. Central
deputation for GST administration of CBEC may not be appropriate, practical and
desirable for efficient and effective indirect tax administration of Central
Government. Further we know that a different function of Union Territories, which
is under exclusive control of Central Government, are carried out by the officials of
AISs i.e. IAS, IPS & IFS and for this purpose a Joint Cadre AGMUT has been
constituted. Therefore on line with Union Territories, it is proposed that CBEC is to
be declared as Joint Cadre. For this purpose reference of Union Territories coming
in existing Rules and Regulation of different All India Services is to be changed to
Union Territories and CBEC while framing Rules and Regulation for IRS as AIS.
Some of main amendments in the existing Act and Rules of AIS and issuance of fresh
Rules and Regulations are discussed in subsequent paras.

ii) Treatment of Senior Duty Posts of Customs and CBN department in AIS
scenario

Presently IRS(C&CE) are manning senior posts of Indirect Tax administration of

CBEC & Revenue department looking after Central Excise, Service Tax, Customs &
CBN. Even in GST environment, Customs and CBN wing of Government of India
will continue to be administered by CBEC. Even though IRS(C&CE) to be declared
as All India Service for better & co-ordinated GST tax administration of both Center
and State, the existing well established administrative mechanism of manning of
Senior Duty Posts of Customs & CBN by IRS(C&CE) should continue. Some of
arguments for maintaining status-quo are as under:-

a) Most of the officers of Group B & C cadres of CBEC are performing

their function in different capacities in Central Excise, Service Tax and
Customs wings of department, wherein officers are transferred and posted
among these wings on rotation basis based on predefined norms.
Recruitments of Group C officers and Group B non-gazetted (barring

18
 few officers of Customs cadre of major Customs Houses)are common for
CBEC without any distinction of their nature of jobs and responsibilities
whether in Customs or Central Excise.
As junior level officers of CBEC are manning both Customs and Central
Excise wing of department without any distinction, Senior Group A
officer i.e. IRS officers should continue to have the same working
flexibility in order to have proper co-ordination, synergy and control
among different wings of CBEC.
b) CBEC will continue to administer central component of GST as well as
Customs, IRS officers will continue to man different formations of
Customs too under CBEC.
c) Export and Import related activities require Customs and GST data
sharing and exchange of various information among Central and States
taxation authorities. As junior functionary of Customs, Central GST and
States GST are of different service cadres, it is essential that senior officers
manning Customs, Central GST and States GST should be of same service
in order to have proper and well co-ordinated exchange of information.
d) Many functions of Exports and Imports especially in respect of
manufacturers viz factory stuffing/de-stuffing, sealing of Export
consignments, Re-warehousing of duty free import consignments, Fixation
of Brand-rate of drawback, certain compliance verification relating to
Export promotion schemes etc requires involvement of central GST
officers for Customs purposes. Therefore for ease of doing of export and
import related activities, it is desirable that existing system of manning of
Central Excise, Service Tax and Customs by IRS(C&CE) has to be
maintained even in the scenario of IRS being All India Service.

After IRS being made as All India Service, though administrative control of
Senior Duty Posts of Customs and CBN remains with CBEC, it is essential and
desirable that IRS officers placed under different Cadres should get equal
opportunities and exposure to work in different formations of Customs and CBN
too. To meet these requirements, Senior Duty Posts of Customs and CBN have to be
divided among different Cadres in the ratio of the sanctioned Senior Duty Posts of
IRS Cadre in that State/Joint Cadre [Sl no 1 of Schedule of Indian Revenue Service
(Fixation of Cadre Strength) Regulations] to total Sanctioned Senior Duty Posts of
IRS Cadres under all State & Joint Cadres [Sl no 1 of Schedule of Indian Revenue
Service (Fixation of Cadre Strength) Regulations].

These Senior Duty Posts of Customs and CBN has to be Cadre deputation post of
IRS and needs to be shown separately in the Schedule of Indian Revenue Service
(Fixation of Cadre Strength) Regulations. At present, there are about 1150 Group A

19
posts in Customs formation. Total sanctioned Group A posts is 5592, which include
2118 temporary posts of Assistant Commissioner. Thus sanctioned Group A posts
of Customs comes out to about 20% of total Group A posts if temporary posts of
Assistant Commissioner are taken into account, otherwise 33%of total Group A
posts if temporary posts of Assistant Commissioner are not taken into account.
Therefore, 30% of Sl no 1 of Schedule of Indian Revenue Service (Fixation of Cadre
Strength) Regulations is appropriate to be earmarked for Cadre deputation posts.
[Please Note aforesaid figures are rough estimate and may vary depending upon
actual no.]

For Central Deputation, there are two schemes devised for the purpose of
regulating appointments in Government of India and organizations under its
control.

Central Staffing Scheme (CSS)

Non-Central Staffing Scheme (Non-CSS)

Deputation of IRS officers placed under different cadres to Senior Duty Cadre Posts
of Customs and CBN wings of central government, it has to be governed by CSS and
Non-CSS of Ministry of Finance to be formulated subsequently. In order to
understand the deputation of IRS officers in Cadre posts of Customs and CBN,
mechanism of deputation of IFS officers to their Cadre posts is described under as
illustration (Source- Wikipedia):-

There are two Central Staffing Schemes, one each controlled by

Ministry of Environment and Forests (India) (MoEF) and Department of
Personnel & Training (DoPT) of Ministry of Personnel, Public Grievances and
Pensions and they are respectively called as CSS of MoEF and CSS of DoPT.

Manning the pre-identified professional positions in the Ministry, its

regional offices, subordinate offices, organisations under its control (located
elsewhere in the country) and in other Ministries/Departments, exclusively by
IFS, CSS of MoEF scheme has been formulated. The posts included under it are
Director General of Forests, Additional Director General of Forests, Inspector
General of Forests and Deputy Inspector General of Forests in Ministry of
Environment and Forests, Associate Professors and Lecturers in IGNFA,
Director of Forest Survey of India, Indira Gandhi National Forest Academy,
Project Tiger, Project Elephant, National Zoological Park, Forest Education and
Deputy Directors/Conservators in Regional offices of the Ministry.

Similar to the CSS of the MoEF, for manning pre-identified positions of

Under Secretary (US), Deputy Secretary (DS), Director, Joint Secretary to

20
 Government of India (JS), Additional Secretary (AS), Special Secretary (SS) and
equivalent levels in the Government of India and its organizations, DoPT have
formulated a staffing Scheme. A total of 38 Civil Services including the three All
India Servicesviz IAS, IPS, IFS are participants under this Scheme.

Similar to the CSS, there are two Non-CSSs under the Government of
India one each controlled by the MoEF and DoPT. All posts to be filled up by IFS
officers in the autonomous bodies under the control of the Ministry viz ICFRE,
Dehradun; Wild Life Institute of India, Dehradun and Indian Institute of Forest
Management, Bhopal; Wild-Life Crime Control Bureau, Central Pollution
Control Board, Central Zoo Authority etc. are called as non-CSS posts. Isolated
posts under various Departments and Ministries in Government of India and the
posts of Commissions, Autonomous Bodies, Authorities, Trusts, Boards,
Societies, etc. constitute non-CSS of DoPT

iii) Cadre Controlling Authorities for the IRS

The Central Government is the Cadre Controlling Authority for the three All
India Services. In terms of the provisions of the respective IAS/IPS/IFS Promotion
Regulations, the Central Government means Ministry of Personnel, Public
Grievances & Pensions, Department of Personnel & Training for IAS, Ministry of
Home Affairs for IPS and Ministry of Environment, Forests & Climate Change for
IFS. Accordingly for IRS, the Central Government, Ministry of Finance will be the
Cadre Controlling Authority.

Further for promotions to Union Territories (UT) segment of Joint AGMUT Cadre
under, the State Government in (Appointment by Promotion) Regulations means
Ministry of Home Affairs for IAS and IPS and the Ministry of Environment, Forests
& Climate Change for IFS. Similarly for promotions to Union Territories (UT) segment
of Joint AGMUT Cadre and CBEC cadre of IRS, the State Government in
(Appointment by Promotion) Regulations will mean Ministry of Finance.

iv) Fresh Recruitment for IRS

As we know that there are two modes of recruitment to the existing All India
Services;

(i) Direct Recruitment: Through the Civil Services Examination for IAS and
IPS and the Indian Forest Service Examination for the IFS. These
Examinations are conducted by UPSC.
(ii) Promotion/Selection: By way of promotion of the SCS/SPS/SFS officers to
the respective All India Service and by way of selection of Non-State Civil
Services (NSCS) Officers to the IAS.

21
 Mode of recruitment for IRS will be on similar line of existing All India Services
and for that Indian Revenue Service (Recruitment) Rules have to be drafted in line
with IAS/IPS/IFS (Recruitment) Rules.

v) Promotion to IRS

At present the number of persons recruited by way of promotion/selection in

any State or group of States shall not, at any time, exceed 33.33% of the total cadre
strength of the All India Service in that State or group of States. Promotions to the
three All India Services viz. IAS, IPS and IFS are governed under the respective
Recruitment Service Rules viz. Indian Administrative Service (Recruitment) Rules
1954, Indian Police Service (Recruitment) Rules 1954 and Indian Forest Service
(Recruitment) Rules 1966 and the respective Promotion Regulations viz. IAS
(Appointment by Promotion) Regulations 1955, IPS (Appointment by Promotion)
Regulations 1955 and IFS (Appointment by Promotion) Regulations 1966.

On similar line, Indian Revenue Service (Recruitment) Rules and IRS

(Appointment by Promotion) Regulations have to be framed. Total 33.33% of the
total cadre strength of the India Revenue Service in that State or group of States or
CBEC has to be filled up by promotion.

Existing State or UT VAT officers shall continue to be promoted as per their

existing Promotion Rules. In case of CBEC officers, promotion from Group B to
Assistant Commissioner shall be governed by separate Promotion Rules, which are
to be framed somewhat in line with Promotion Rules of State VAT Cadres. This will
definitely lead to better promotional aspect of Group B officers of CBEC.

vi) Cadre Allocation of existing officers of IRS(C&CE) to IRS in AIS scenario

Prior to the notified date of IRS being declared as All India Service, all officers
already working as IRS(C&CE) in CBEC necessarily have to be allotted to State
Cadre or Joint Cadre or CBEC Cadre. Depending upon cadre strength of each state
as per Indian Revenue Service (Fixation of Cadre Strength) Regulations, batch-wise
Cadre strength of presently working IRS officers has to be determined for each
Cadre. Based on the ratio of each Cadre to batch-wise Cadre strength, the officer of
each Batch as per their seniority of Civil List as well as option to select Cadres, a
Cadre will be allocated. Where officers are not allocated Cadre as per their option,
Cadre has to be allocated as per existing guidelines of allocation of Cadres for All
India Services. Inter-se-seniority in a Cadre has to be among the officers allotted to
that Cadre as per their seniority in the Civil List. In order to address dissatisfaction
of an office in allotment of his Cadre, one may be given option to work on
deputation to the Cadre of ones choice or Central Cadre deputation of Customs or
CBN as per detailed guidelines to be framed in this regard.

22
vii) Steps required for making IRS(C&CE) from Central Services Gr A to AIS

1. A political Consensus by Central & State Leadership:-In principal agreement in

GST Council for the creation of an All-India services for GST administration and
thereby conversion of IRS(C&CE) from Central Services Gr A to All India
Service (AIS). Accordingly GST Council to pass a resolution to this effect.

2. Resolution by Rajya Sabha by Special majority:-The Constitution of India has

made special provision for the constitution of all-India services as a service
common to the Union and the states. Article 312 of the Constitution of India
provides for the creation of an All-India services by parliament if the council of
states (Rajya Sabha) declares by not less than two-thirds of the members present
and voting that it is necessary in the national interest that in respect of a
particular service an all-India cadre of officers should be constituted.

3. Framing of Rules and Regulations:- Once resolution is passed by Rajya Sabha for
creation of an All India Service for GST administration common to Centre and
States and thereby conversion of IRS(C&CE) from Central Services Gr A to IRS
as All India Service (AIS). As the Constitution of India provides for making of
Rules to regulate the recruitment, and the conditions of service of persons
appointed, to the service, amendments are required to be made in Existing Act
and Rules of AIS. Also fresh Rules and Regulations are to be made for regulating
conditions of service.

Some of main amendments in the existing Act and Rules of AIS and issuance
of fresh Rules and Regulations are summarized as under

(a) Section 2A of the All India Services Act, 1951 to incorporate Indian Revenue
Service (IRS) as one of another AIS,

(b) Indian Revenue Service (Cadre) Rules to be notified. Existing Service (Cadre)
Rules has defined State as`State' means a State specified in the First Schedule to
the Constitution and includes a Union territory.

As Central component of GST taxation to be administered by CBEC on

pan India basis and CBEC constituting largest no of IRS officers among all IRS
cadres of Center and States, GST wing of CBEC has to be defined as one of
cadre. Therefore definition of States in IRS (Cadre) Rules needs to incorporate
CBEC also i.e.`State' means a State specified in the First Schedule to the
Constitution and includes a Union territory and CBEC.

23
 Similarly Constitution of Cadres also needs to be defined in Indian
Revenue Service (Cadre) Rules as under:-
i. There shall be constituted for each State or group of States or CBEC an
Indian Revenue Service cadre.
ii. The Cadre so constituted for a State or a group of states and CBEC is
hereinafter referred to as a `State Cadre' or, as the case may be, a `Joint
Cadre'.

(c) All-India Services (Joint Cadre) Rules, 1972 is to be amended to incorporate

CBEC as another joint cadre for IRS i.e. Rule 1(ii) needs to be amended as
under :-
They shall apply to a Joint Cadre constituted for any group of States
other than the Joint Cadre of Union Territories.
Provided that in respect of IRS, they shall apply to a Joint Cadre
constituted for any group of States other than the Joint Cadre of Union
Territories and CBEC.

(d) Indian Revenue Service (Fixation of Cadre Strength) Regulations to

incorporate no of senior duty posts of Customs and CBN formations under
CBEC or other formations of Central Government as cadre deputation post.
Accordingly Customs Cadre strength has to be shown separately in the
Schedule for each Cadre state or state concerned. Therefore Schedule to
Indian Revenue Service (Fixation of Cadre Strength) Regulations for the
heading [Name of State Cadre] should be as under :-

The posts borne on, and the strength and composition of the cadre of
the Indian Revenue Service of the various States shall be as specified in
the Schedule to these regulations.
SCHEDULE
[Name of State Cadre]

1. Senior posts under the Government of [Name of State Cadre] ----

-
-
1. Total Senior Duty Posts ----
2. Total Senior Customs & CBN Posts under CBEC or other ----
formations of Central Government not Exceeding to 30%
of Item 1 above
3. Central Deputation Reserve not exceeding to 20% of Item ----
1+2 above
4. State Deputation Reserve not exceeding to 25% of Item 1+2 above ----

24
 5. Training Reserve not exceeding to 3.5% of Item 1 +2 above ----
6. Leave Reserve and Junior Posts Reserve not exceeding to16.5% ----
Of items 1 + 2 above
7. Posts to be filled by promotion under Rule 9 of the Indian ----
Revenue Service (Recruitment) Rules, not exceeding to
33 1/3% of Items 1,2,3,4 &5above
8. Posts to be filled up by Direct Recruitment ----
(Items 1+2+3+4+5+6-7)
Total Authorized Strength ----

Indian Revenue Service (Recruitment) Rules has also to be notified in

line with IAS/IPS/IFS (Recruitment) Rules. In this Rule also, definition of
States needs to incorporate CBEC i.e. `State' means a State specified in the
First Schedule to the Constitution and includes a Union territory and
CBEC.

(e) Indian Revenue Service (Appointment by Promotion) Regulations has also to

be notified in line with IAS/IPS/IFS (Appointment by Promotion)
Regulations. In the Regulations, State Revenue Service needs to be
defined for State Cadre, Joint Cadre and CBEC Cadre for the purpose of
filling up the vacancies in Indian Revenue Service.

Similarly State Government has also to be defined in Indian Revenue

Service (Appointment by Promotion) Regulations as under:-

State Government means

(i) in relation to a State in respect of which a separate cadre of the
Service exists, the Government of such State;
(ii) in relation to a group of States in respect of which a Joint Cadre of
the Service is constituted, the Joint Cadre Authority.

(ii) in relation to a group of Union Territories and CBEC in respect of

which a joint cadre of the Service is constituted, the Central Government.

25