21,791 fake GST registrations unearthed, Rs. 24,000cr evasion suspected: FM
During a recent two-month special drive, Finance Minister Nirmala Sitharaman announced that GST officers discovered 21,791 fake GST registrations and over Rs. 24,000 crore in suspected tax evasion. In a written response to the Rajya Sabha, she emphasized the need to protect honest taxpayers and avoid extreme hardship for taxpayers. Sitharaman said that instructions have been issued from time to time, directing officers to exercise caution when using powers such as summons, provisional attachment of property, and blocking tax credit.
11,392 entities pertain to state tax jurisdiction
The Finance Minister further explained that out of the fake registrations, "11,392 entities pertain to state tax jurisdiction and 10,399 entities pertain to CBIC jurisdiction." The Central Board of Indirect Taxes and Customs (CBIC) conducted the special drive against fake GST registrations from May 16 to July 15, 2023, uncovering a total of Rs. 24,010 crore in suspected tax evasion (state - Rs. 8,805 crore + Centre - Rs. 15,205 crore).
Breakdown of fake registrations and suspected tax evasion
Addressing challenges faced by e-commerce businesses in obtaining GST registrations, Sitharaman revealed that a simplified registration process has been introduced. Amendments to GST rules now include biometric-based Aadhaar authentication for high-risk registrants and verification of original documents. A pilot project was initially launched in Gujarat and later expanded to Puducherry and Andhra Pradesh. Moreover, entities are required to provide bank account details, name, and PAN within 30 days or face automatic suspension by the system.
