“Join the nationwide initiative against fake GST registrations! Learn about the mechanisms and actions planned by the GST departments. Stay informed on the special drive to combat bogus invoices and protect government revenue.”
Nationwide Initiative to Combat Fake GST Registrations: Mechanisms and Actions by the Department – Instruction No. 01/2023-GST dated 04th May, 2023
In a concerted effort to tackle the pervasive issue of fake and bogus GST registrations, the Central and state GST departments have planned a special all-India drive from May 16th to July 15th, 2023. This initiative aims to verify and take appropriate action against suspicious suppliers and curb the issuance of bogus invoices, ultimately preventing revenue losses to the government.
In this article, we will delve into the mechanism that will be adopted during the verification drive and outline the potential penal actions against those engaging in fraudulent practices.
Step-1: Identification of suspicious/ bogus suppliers.
Step-2: Detailed verification such identified suppliers.
Step-3(a): If supplier found genuine – No further action shall be taken.
Step-3(b): If supplier found non-existent and fictitious – Steps 4(a) & 4(b) shall be taken.
Step-4(a): Action against the identified bogus suppliers –
Step-4(b): Action against recipient(s) of the identified bogus supplier – The details of the recipients to whom the input tax credit shall be identified through the FORM GSTR-1 by such bogus supplier.
Potential Action –
Step-5: Reporting by the Central & State authorities to GST Council Secretariat who shall report to the National Coordination Committee.
The ongoing special drive against fake/bogus GST registrations demonstrates the commitment of the Central and state GST departments to ensuring the integrity of the taxation system. By implementing robust verification mechanisms and taking stringent actions against both bogus suppliers and recipients, the authorities aim to curb revenue losses and promote a transparent and trustworthy business environment. The provided guidelines and cooperation with various stakeholders will further strengthen the effectiveness of this initiative.
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