Guidelines for the Second Special All-India Drive Against Fake Registrations
The Central Board of Indirect Taxes and Customs (CBIC) has announced a second special All-India drive against fake GST registrations. This initiative aims to further strengthen the tax base and eliminate fraudulent activities. Below are the key points of the guidelines..
1. What is the period of the second special drive?
The drive will be conducted from 16th August 2024 to 15th October 2024.
2. How will fraudulent GSTINs be identified?
• GSTN, in coordination with DGARM, CBIC, will identify suspicious/high-risk GSTINs using data analytics and risk parameters.
• The identified GSTINs will be shared with the relevant State and Central Tax authorities.
• Additional suspicious GSTINs may also be identified through local data analysis, intelligence gathering, and analytical tools like BIFA, GAIN, ADVAIT, NIC Prime, E-Way Bill Analytics, etc.
3. What actions are expected from field formations?
• Conduct a time-bound verification of the suspicious GSTINs.
• If a taxpayer is found non-existent or fictitious, the tax officer should initiate the suspension and cancellation of the registration.
• Block input tax credit in the Electronic Credit Ledger as per Rule 86A if necessary.
• Identify and take action against recipients who have availed input tax credit based on invoices issued by non-existent suppliers.
• Share details with the relevant tax jurisdiction if the recipient GSTIN is outside the officer's jurisdiction.
4. How should the information be shared with other tax jurisdictions?
• A nodal officer should be appointed by each Zonal CGST Zone and State for communication and coordination.
• The details of these nodal officers must be shared with the GST Council Secretariat within three days.
• Information should be shared using the 'Initiate Enquiry' functionality on the BO Portal.
5. What are the additional actions to be taken against masterminds or linked GSTINs?
• Identify and take action against the masterminds/beneficiaries behind fake GSTINs.
• Consider recovery of Government dues and provisional attachment of properties or bank accounts.
• If any linked suspicious GSTINs are detected, similar actions should be initiated.
6. What is the feedback and reporting mechanism?
• Action-taken reports must be uploaded weekly by each State and CGST Zone through the nodal officer.
• Novel modus operandi detected during verification should be included in the report.
• On conclusion, GSTIN-wise feedback should be provided to GSTN.
7. How will the progress and findings be monitored?
• The Principal Chief Commissioners/Chief Commissioners will monitor the progress of actions taken against suspicious GSTINs.
• The GST Council Secretariat will compile reports and unique modus operandi for sharing with Central and State Tax administrations.
Only the Frauds Need to Fear
The second special All-India drive is a crucial step in ensuring the integrity of the GST system. These guidelines aim to ensure a coordinated and effective approach across all tax jurisdictions, thereby safeguarding government revenue and maintaining a clean tax base.
Link to read full instruction:Explore (cbic.gov.in)
Link to read about first drive: Strengthening Verification Procedures: Guidelines to Prevent Fake GST Registrations (aagamshahca.com)
Disclaimer: This material and the information contained herein is intended for clients and other Chartered Accountants to provide updates and is not an exhaustive treatment of such subject. We are not, by means of this material, rendering any professional advice or services. It should not be relied upon as the sole basis for any decision which may affect you or your business.
