Page 12 - Banking Finance April 2020

GST UPDATE

After settlement of taxes on inter-state have been made aware regarding the 28% to 18% and from 18% to 12% that
supplies, the central government earned same and instructions have been issued it implemented in November 2017 have
Rs. 43,155 crore in February, while states to them,” Negi added. not been passed on to the consumers.
collectively made Rs. 43,901 crore. Patanjali has argued that they bore the
CGST arrests one person in cost of rate increase when compared
"With the monthly collections now connection with fake GST to the pre-GST regime and did not pass
stabilising at over Rs. 1 trillion a the cost of increased prices onto the
month, the authorities would now go invoices consumers. The NAA did not accept
all out to enhance collections in March One person has been arrested by the this on the grounds that Patanjali took
so that the GST revenue deficit is Central Goods and Services Tax (CGST) a business call to not increase prices
reduced to the extent possible," said Delhi North Commissionerate for and that this cannot be a reason for
M.S. Mani, partner at Deloitte India. receiving fake invoices valued at Rs not giving GST reduction benefits to
71.22 crore involving fraudulent Input the consumers.
Punjab, Delhi and Maharashtra Tax Credit (ITC) of Rs 12.82 crore from
reported 12% growth in revenue 30 bogus firms. NAA said, “The contention is not
correct since the authority or DGAP has
receipts in February from a year ago, not acted as a price controller or
while Gujarat reported an 11% In an official statement, the finance regulator. The authority has only been
growth. Karnataka reported a 15% ministry said that the modus operandi mandated to ensure that benefits of
growth in collections in February from was to build several fake companies in tax reduction and ITC are passed on to
a year ago, while Tamil Nadu showed the name of employees of the end consumers who bear the burden.”
8% jump, official data showed. operator of fake firms and other
persons. The statement further added, GST Intelligence unearths
Two cold stores raided by “The accused was arrested Saturday
and was sent to judicial custody till GST fraud of Rs 150 crore
GST dept at Jalandhar March 21. Further investigation in the The Directorate of the Goods and
The Ludhiana state GST Department case is in progress.” Services Tax Intelligence in Delhi has
has recently raided in two cold stores – identified fraudulent input tax credit
Kissan Cold Storage and CC Cold Storage NAA penalizes Patanjali (ITC) claims worth Rs 150 crore after a
– at the Jalandhar bypass chowk. The series of raids, according to the
raid was conducted to check hoarding for not passing GST information by the officials. GST
of pulses as these are not available for benefits to consumers intelligence officials conducted raids at
the general public due to lockdown The National Anti-Profiteering Authority units in Jammu and Kashmir, Delhi and
amidst Covid-19 scare. (NAA) has imposed a fine of Rs 75.08 Uttar Pradesh, finding most of them to
be fake companies. The bogus firms had
crore on Patanjali Ayurveda Ltd for not
Stock at stores was found intact but passing the benefits of GST rate purportedly supplied goods worth Rs
the department directed owners not reduction on to the consumers. As per 1,500 crore to help claim ITC of about
to hoard commodities. STO HS Naghi the reports, the NAA has said that Rs 150 crore in the past two years.
said that it was routine visit to ensure Patanjali had increased the price of their The two Srinagar-based units used to
checking of hoarding of pulses in such washing powder after GST reduction. get fake bills from the bogus
crucial time. Department officials called
companies and then claim ITC refunds
dealers whose stock was stored in cold “The respondent (Patanjali) has denied from the government, according to the
storage and directed them to get curfew the benefit of tax reduction to
officials. The accused had deposited Rs
passes and make uninterrupted supplies consumers in contravention of the 6 crore with the GST authorities.
to households. If anybody was found Central GST Act,therefore a showcase Officials said investigations are still in
violating the rules he would be punished, notice be issued directing it to explain progress. Under ITC, manufacturers
officials added. “Shop owners are not why the penalty should be imposed,” can deduct tax on inputs for their
hoarding stock, but are unaware of the stated NAA. The NAA has further stated businesses from the amount that has
procedure to obtain curfew passes. They that the benefits of rate change from to be paid to the government.

10 | 2020 | APRIL | BANKING FINANCE