A reference has been received from the DGoV, CBIC, New Delhi stating therein that a GST officer, mapped in the GSTN portal, was not de-mapped with immediate effect after his relieving from the charge, which resulted into fraudulent sanction of refund by the officer.

The scenario may arise in a CGST Zone where an issue investigated by one of the (Pr.) Commissioners is based on an interpretation of CGST Act/ Rules,

Attention is invited to the Instruction No. 01/2023-GST dated 04.05.2023 vide which guidelines were issued for conducting a special All-India drive during the period from 16th May 2023 to 15th July 2023

Attention is invited to sub-section (1) of section 79 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘CGST Act’),

The undersigned is directed to say that the matter of CGST field formations following a uniform procedure in undertaking enforcement activities, with or involving regular taxpayers, which incorporates aspects related to the ease of doing business, was considered by Board.

Representations have been received in the Board that, subsequent to the aforesaid judgment, many field formations have initiated proceedings for the alleged evasion of GST on the issue of secondment under section 74(1) of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as the ‘CGST Act’).

Reference is invited to the provisions of section 52, section 73, section 74, section 122, section 123, section 124, section 125, section 127, section 129 and section 130 of Central Goods and Service Tax Act, 2017 (herein after referred to as the CGST Act), as per which a notice is required to be issued by the proper officer to a person for demand and recovery of any amount of tax not paid or short paid/ amount of input tax credit wrongly availed/ amount of refund erroneously made, for recovery of interest and/ or for imposition of any penalty or fine on the said person.

Consumer Welfare Fund (CWF) has been constituted under Section 57 of the Central Goods & Service Tax (CGST) Act, 2017. The provision for utilization of CWF has been made in Section 58 of the CGST Act, 2017

It has been observed that in many cases of issuance of fake invoices and availment of ITC on the basis of fake invoices, the persons who have orchestrated/perpetuated these fraudulent acts are seeking judicial intervention through Hon’ble High Courts especially by challenging the power of arrest in terms of Section 69 of the CGST Act, 2017.

The Hon’ble Supreme Court vide its Order dated 29.05.2019 in regard to SLPs No. 4322-4324/2019 filed against the final judgment and order dated 11-04-2019 in CRLWP Nos. 1996/2019, 1997/2019 and 1998/2019, passed by the High Court of Judicature at Bombay, essentially challenging the Power to Arrest under Section 69 of the CGST Act, 2017 has, inter alia directed as under:

Instances have come to notice regarding unscrupulous elements obtaining fake/ bogus registration under GST and defrauding the Government exchequer.

Attention is invited to the Instruction No. 02/2022-GST dated 22nd March, 2022, wherein a Standard Operating Procedure (SOP) was provided for scrutiny of returns under section 61 of Central Goods and Services Tax Act, 2017 (hereinafter referred to as “the CGST Act) read with rule 99 of Central Goods and Service Tax Rules, 2017 (hereinafter referred to as “the CGST Rules”) for FY 2017-18 and 2018-19.

During the National Coordination Meeting of the State and Central GST officers held at New Delhi on 24th April 2023, the issue of unscrupulous elements misusing the identity of other persons to obtain fake/ bogus registration under GST, with an intention to defraud the Government exchequer, was deliberated.

Attention is invited to Standard Operating Procedures (SOPs) for verification of risky exporters and their suppliers dated 23.01.2020 issued to CGST and Customs formations as well as Directorate General of Analytics and Risk Management (DGARM) and SOP dated 20.05.2020 issued to CGST formations and DGARM vide F. No. CBEC-20/16/07/2020-GST which provided for the procedure to be followed for verification of the risky exporters and their suppliers.

Explore INSTRUCTION No. 04/2022-23 [GST – Investigation] Prosecution & its implications for taxpayers. Get informed and stay compliant with the latest updates.

It has been brought to the notice of the Board that in certain instances, summons under Section 70 of the Central Goods and Services Tax Act, 2017 (‘the CGST Act) have been issued by the field formations to the top senior officials of the companies in a routine manner to call for material evidence/ documents. Besides, summons have also been issued to call for statutory records viz. GSTR-3B, GSTR-1 etc., which are available online in the GST portal.

Hon’ble Supreme Court of India in its judgment dated 16 August, 2021 in Criminal Appeal No. 838 of 2021, arising out of SLP (Crl.) No. 5442/2021, has observed as follows:
“We may note that personal liberty is an important aspect of our constitutional mandate. The occasion to arrest an accused during investigation arises when custodial investigation becomes necessary or it is a heinous crime or where there is a possibility of influencing the witnesses or accused may abscond.

Attention is invited to sub-section (2) of section 107 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act”) which provides that the Commissioner may review any decision or order, including an order of refund, with respect to its legality or propriety and he may direct any officer subordinate to him to file an appeal against the said decision or order within 6 months of the date of communication of the said decision or order.

During the course of search, inspection or investigation, sometimes the taxpayers opt for deposit of their partial or full GST liability arising out of the issue pointed out by the department during the course of such search…

Section 61 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “the CGST Act”) read with rule 99 of Central Goods and Services Tax Rules, 2017 (hereinafter referred to as “the CGST Rules”) provides for scrutiny of returns and related particulars furnished by the registered person.