CBIC To Conduct 2-Month Special Drive To Weed Out Fake GST Registrations

New Delhi: CBIC will launch a two-month special drive to unearth bogus GST registrations and take action to identify the masterminds/beneficiaries as it aims to eliminate bogus ITC claims. Fake/non-genuine registrations are being used to fraudulently pass on Input Tax Credit (ITC) to unscrupulous recipients by issuing invoices without underlying supply of goods or services or both.

CBIC’s GST Policy Wing said that fake registration and issuance of bogus invoices to pass on bogus ITC has become a serious problem wherein fraudsters indulge in dubious and complex transactions, causing loss of revenue to the government .

“A special pan-India drive may be launched by all Central and State tax administrations during the period from 16th May 2023 to 15th July 2023 to detect suspicious/fake GSTINs and requisite verification to weed out these fake billers” And further remedial action can be taken.The Central Board of Indirect Taxes and Customs (CBIC) in a communication asked for the protection of the GST eco-system and government revenue.

At present, 1.39 crore taxpayers were registered under Goods and Services Tax (GST). The identification of fraudulent GST Identification Numbers (GSTINs) will be based on detailed data analysis and risk parameters. GSTN will identify such fraudulent GSTINs and share the details of such suspected GSTINs with the concerned State/Central Tax Administration to initiate the verification drive and subsequently take necessary action.

The issue of unscrupulous elements misusing the identity of other persons to obtain fake/fake registration under GST was discussed in the National Coordination Meeting of State and Central GST Authorities on 24th April. On receipt of data from GSTN, a time bound exercise of verification of suspect GSTINs will be undertaken by the concerned jurisdictional tax authorities. If, after detailed verification, it is found that the taxpayer does not exist and is fictitious, the tax authority may immediately initiate action for suspension and cancellation of registration.

“For further action to identify the masterminds/beneficiaries behind such fake GSTINs, wherever necessary, and also for recovery of Government dues and/or provisional attachment of assets/bank accounts etc. As per the provisions of section 83 CGST Act,” CBIC said.

NA Shah Associates, Partner, Indirect Taxes, Parag Mehta said that the drive against bogus registration and bogus ITC will ensure that such persons are removed from the system and the benefits of GST are available to all compliant taxpayers.

“It should also be ensured that law abiding assessees are not harassed in their zeal to trace such taxpayers. Proper procedures and SOPs have been issued to ensure minimum inconvenience to normal business houses,” Mehta said. Must go.”


Rajat Mohan, senior partner, AMRG & Associates, said these two months of the drive could lead to huge tax collections in the coming months, breaking the glass ceiling once again.
GST collection in April reached a record high of Rs 1.87 lakh crore.