In a sweeping move, Goods and Services Tax (GST) authorities have issued demand notices totaling ₹1.45 lakh crore to approximately 1,500 businesses in December. The notices, attributed to inconsistencies in annual returns and input tax credit claims for the financial year 2018, included penalties and interest, according to officials.
The surge in notices was primarily a result of the December 31, 2023 deadline for serving notices related to the 2017-18 period. GST officers detected evasion amounting to about ₹1.51 lakh crore in the current fiscal, but the recovery stood at ₹18,541 crore as of December 30, falling significantly short of the internal target of ₹50,000 crore.
With 72.5 lakh GST returns filed in 2017-18, only a fraction underwent scrutiny for potential tax underpayment. By December 30, around 48,000 GST returns from 2017-18 and 2018-19 were selected for scrutiny due to discrepancies or flags raised by the system.
As the focus now shifts to the fiscal year 2018-19, officials anticipate a potential increase in the number of notices in the coming days. The government has extended the deadline for issuing demand notices related to discrepancies in returns for the 2018-19 and 2019-20 periods to April 30, compared to the earlier deadline of March 31.
Simultaneously, the government announced that GST officers have identified 29,273 bogus firms involved in fake Input Tax Credit (ITC) claims, totaling ₹44,015 crore, during an eight-month drive against fake registration. This initiative, aimed at curbing fake ITC claims, saved revenue of ₹4,646 crore.
In the October-December quarter alone, 4,153 bogus firms engaging in suspected ITC evasion of approximately ₹12,036 crore were detected, with 2,358 of them uncovered by the Central GST Authorities. These measures underscore the government's commitment to enhancing tax compliance and preventing revenue leakage through fraudulent means.
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