The government had collected INR 95,000 crore under GST regime for July month and as the Union Minister mentioned in the statement the compliance is 64% of the total 8 million taxpayers. The analytics are showing the great number of tax collection but the close look reveals the reality to return INR 65,000 crore as transitional credit and the huge claims of INR 65,000 crore have made the government stumbled. If the possibility of being all credit claims genuine becomes true, it will be going to affect the all GST system and government expenditures. Besides transitional credit claim, the government will also get the claims for input tax credit which is not known by yet.
For the government, it is the matter of scrutinizing and CBEC is ready for truthfulness check of the claimed credits of an individual having over 1 crore Rs. claim.
The CBEC member and special secretary, Mahender Singh, has mentioned the issue to the chief commissioner in a letter. He says, “The statement received from GST Network revealed that so far, the registered persons have claimed over Rs 65,000 crore as CGST transitional credit. The possibility of claiming the ineligible credit due to mistake or confusion cannot be ruled out. Accordingly, it is desired that the claims of credit of more than Rs 1 crore may be got verified in a time-bound manner”
The veracity of an inspection will include the tally of credit claimed with closing balance in return filed under GST and eligibility for the credit claimed. The report for such a verification would be completed by September 20 as mentioned in a letter to the chief commissioner.
The GST expert, Pritam Mahure mentioned three reasons for mistaken or confused claims; which are closing stock reclined with manufacturer and traders, inverted duty structure, and as the government has allowed getting excise duty credits for the 1-year old stocks.
The experts on the issue of mistaken and ineligible claims advised traders to recheck their claims before the inspection made by the government and action would be taken against the untrue claims. “The government seems to have concerns with input tax credits claimed in TRAN-1 forms by taxpayers and thus, it is advisable that the taxpayers should immediately get these credits independently reviewed to avoid subsequent penal implications on inadvertently claimed credit,” said Jigar Doshi, SKP Business Consulting.
