Rs 24,010 Crore GST Evasion, 21,791 Fake Entities Detected In Special Drive: Sitharaman

As many as 21,791 entities having fake GST registration and suspected tax evasion of Rs 24,010 crore were detected in a recently concluded special drive, Union Finance Minister Nirmala Sitharaman said on Tuesday.

The special drive was held from May till July by the Central Board of Direct Taxes to identify bogus registrations and fraudulent claims, Sitharaman said in a written response to a question in the Rajya Sabha.

Out of the fake entities, 11,392 belonged to the state tax jurisdiction and 10,399 entities were pertaining to the CBIC jurisdiction. Out of the suspected evasion, Rs 8,805 crore pertains to the state jurisdiction and Rs 15,205 crore to the Centre, respectively.

Sitharaman underscored that efforts were being taken to alleviate the challenges faced by e-commerce enterprises that operate virtually in securing registrations.

"Considering the special nature of e-commerce operators, a simplified procedure for registration of e-commerce operators has already been notified," she said. "It provides that when an ecommerce operator applies for registration in a particular state or Union territory where he does not have a physical presence, he can apply for registration by giving details of the principal place of business located in another state or Union territory."

To strengthen the process, the department has also made amendments to necessitate biometric-based Aadhaar authentication for those identified as 'high risk'. A bank account and the PAN of the registered person are requisites for GST registration.

Details of the bank account and PAN must be furnished within 30 days of registration or before filing a statement of outward supply, whichever is earlier. Otherwise, the registration will be suspended.

A pilot project for biometric aadhaar authentication for risky individuals, along with physical verification, was first launched in Gujarat before being extended to Puducherry in July and Andhra Pradesh in November.

Sitharaman pointed out that to protect legitimate small and medium taxpayers from being adversely impacted by the special drive, officers were directed to exercise caution in the exercise of powers like summonses, provisional attachment of property and blocking of tax credit.