CBIC Recommends New Validations of GST Return Forms for Tracking Evasion

Additional validations would help check fraud and revenue loss in the GST return filing system.

New Delhi : The Goods and Services Tax (GST) Council, India’s apex decision-making body on indirect taxes, has notified that it might consider the CBIC’s recommendations on adding new validations to the GST return filing in order to track evasion and fake ITC claims in its upcoming 50th GST Council meeting scheduled in July. The action was taken by the Central Board of Indirect Taxes and Customs (CBIC) in response to the reports of many fake ITC (input tax credit) claims detected by many central agencies amounting to nearly Rs 62,000 crore, in response to which more than 700 people, including professionals, were also arrested. Additional validations would help check fraud and revenue loss in the GST return filing system.

according to an official, “We are planning to introduce validations in the returns filing system in such a way that the process does not become cumbersome for honest taxpayers. The validation would be done by the tax department and ITC claims could be blocked in cases of mismatch.” Before the additional validations proposed by the CBIC could be applied they must be validated and approved by the GST Council, which is expected to be discussed in the next council meeting next month.

The Council also launched a special two-month tax evasion drive from May 16, under which the GSTN has already flagged around 60,000 GST registrations that could be fake. The physical verification of the business premises of these entities is under process. The officers have so far confirmed and are taking action against 11,140 fake GST registrations, including more than Rs 15,000 crore of GST evasion.