Here we are going to know about Budget 2020 and fake GST ITC claim now a non-bailable offense. We are studying about the non-Bailable offense of GST ITC the issues of ensuring GST ITC section 122 or 132 of CGST Act and measures which prevent fake GST ITC claim.
The Budget 2020 was passed in Parliament on 1 February 2020 by the Finance Minister of India Smt. Nirmala Sitharaman. There is no doubt that this is a tax-friendly budget. A Budget was released for Indian waffles to increase their income as well as their purchasing capacity.
The second meeting of National GST Priming of the Commissioners of State Tax and Chief Commissioners of Central Tax was held here today under the chairmanship of Dr. Ajay Bhushan Pandey, Revenue Secretary, Ministry of Finance.
In the spending session, the government has familiarized many important activities in correcting the GST structure. Various measures were examined to upgrade the Goods and service tax network (GSTN) and to strengthen the continuity component for citizens with GST Registration Online.
- Critically, in the spending session, the government has introduced the most inconvenient issue with some stringent measures, for example, the issue of fake GST ITC claims made by some misleading traders. Very soon, GST ITC Assurance will be made a non-bailable offense. Besides, the recipient and the person claiming such fraud will be subject to punitive action under the GST law.
Currently, there is a lot of problem on the issue of claiming fake ITC. Many cases were covered by the government, with some taxpayers distributing higher input tax credits. In which ITC claims were found to be false.
GOVERNMENT PLANNED TO UNZIP THE RIGHTS OF ITC
- The government had taken some measures of late, so it was planned to cancel the consolidated GST information expenditure credit by GST registered citizens.
- In these days, the GST department imposed a ban on GST ITC leverage. But now, a dealer can requirement maximum ITC in GSTR-2A 10%.
- Besides, second national GST priming was conducted on 7 January 2020 to address the problem of fake ITC claims.
- And now, in the Union Budget 2020 session, the government has introduced the strictest measures for a strict ITC claim for tenancy, making it a non-bailable offense
- Concerning this, a proposal to update sections 122 and 132 of the CGST Act 2017 was submitted by the government.
The following measures were decided to prevent fake GST ITC claims:
- The discovery was made to link foreign exchange remittances to the risk and IGST refunds for a new exporter because of claims of fake IGST refunds.
- All the major cases of the fake input tax credit, export/import fraud, and fraudulent refunds will be compulsorily investigated by the Investigation Branch of the Income Tax Department.
- The MOU will be signed between CBDT, CBIC, and GSTN from CBDT to GSTN and CBIC and data exchange for this will be done via API. It was decided that this data should be shared every quarter rather than shared on an annual basis.
- Discovering access to banking transactions including bank account details using the GST system in session with RBI and NPCI. Suggestions were also received for obtaining bank account details and transactions and aligning the GST system with FIU for PAN-based banking transactions.
- Sharing data on cases of theft and fraud committed by CBICT and vice versa so that these frauds can be properly implicated.
- It was also suggested to provide a single bank account for overseas remittance receipts and return disbursements.
- Declaration of self-assessment to be determined by suitable amendments for GST return filing forms in case of closure of businesses.
- Verify unmatched input tax credit received by taxpayers.
CHANGE MADE IN SECTION 122 OF CGST ACT
- Section 122 of the CGST Act 2017 states that if a person violates the continuation of GST or assures GST ITC, he has to pay a maximum of ₹ 10,000 / – plus tax which is more
- Currently, the government proposes to update this clause to exclude ITC assurances of achieving excellence, so that there is no risk of any punitive activity.
Changes That Occurred In Section 132 Of CGST Act
As a step, section 132 of the CGST Act 2017 will be replaced similarly. A fake ITC assurance will be required for this correction without any GST receipt, without any bailable offense. From its effect, detention will be a risk for the duration as indicated only:
- Fake ITC close
- The person who is associated with fake ITC surety
- Be sure to quit with excitement.
In true sense, Sector 132 of the CGST Act 2017 has a detention period of at least half for false ITC claims, which can reach up to 5 years.
It is better to follow the valid GST stability and follow the correct GST receipt for the ITC warranty.
