Budget may make faking input tax non-bailable crime for buyers too

The government is seeking to prevent leakages by tightening the GST law on fraudulent demands for an input tax credit in the hands of those who receive goods and services in the February 1 budget.

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CXOs, directors or employees who are directly responsible for such claims can be fined under proposed changes aimed at dealing with evasion.

Changes in the law are being proposed to address issues relating to the fraudulent input tax credit.

The Rs 5 crore limit applies to the offence considered on bail; In spite of that, it will not bail. This provision already applies to suppliers of goods and services. The GST Council has made changes, and it is now proposed to expand the provision to include those accused of such fraud.

The Legal Committee and the GST Council have approved the proposed amendments to Sections 122 and 132 of the GST Act. Current regulations have no specific measures to deal with such tax evasion.

Value-added tax, such as GST, must have explicit penalties for dealing with cases of active compliance in input tax credit fraud,” said Deloitte India Partner MS. Said the bell.

Such cases of a small community of taxpayers lead to increased compliance and procedural requirements for all taxpayers. Another official has come to the government saying that beneficiaries of such false claims, usually made by fake companies, should be fined. Authorities have filed numerous lawsuits claiming input tax credit without receiving invoices or goods or services. The second official said that a clear provision in the law would provide a framework for dealing with such cases.

One official said the names of daily wage rickshaw pullers and others are used to open many companies that offer invoice services without providing goods or services to send an input tax credit. Planners of such frauds also arrange for actual suppliers of goods or services to be sold at an agreed amount. These suppliers use this debt to fulfil their GST obligation or to repay the debt that is paid for the export of high-value goods, the official said.

The GST Council has also approved changes to Section 49 of the GST Act which empowers authorities to prevent debt in the case of fraud. It will also be introduced in the budget. Experts said the changes would have to be detailed in order to avoid confusion. “When there is a need for legislative assistance to prevent such incidents, it is important for the government to issue detailed guidelines on how and when these rules should be applied, thus reducing the possibility of misuse,” said Indirect Tax Chief Pradeep Jain, PVC.

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Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

Certicom Consulting

Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

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