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  Business   In Other News  20 Mar 2018  CBEC to verify 50,000 GST transitional credit claims

CBEC to verify 50,000 GST transitional credit claims

THE ASIAN AGE.
Published : Mar 20, 2018, 1:58 am IST
Updated : Mar 20, 2018, 1:58 am IST

The verification drives come when GST revenue has not picked up.

Sources said that credit verification will remain one of the focus areas in FY19.
 Sources said that credit verification will remain one of the focus areas in FY19.

New Delhi: To prevent fraudulent  tax credits, the CBEC will verify demands of top 50,000 tax payers claiming maximum GST transitional credit, starting with those where the quantum exceeds Rs 25 lakh.

As part of transition to GST last July, taxpayers were allowed to file Form TRAN-1 and avail tax credit on the basis of closing balance of the credit declared in the last return under pre-GST regime.

 

According to revenue department data, as much as Rs 65,000 crore of transitional input tax credit was claimed by businesses as on September 2017.

The verification drives come when GST revenue has not picked up.

CBEC officials suspect that some of these businesses might have obtained a registration under the GST only to claim transitional credit benefits. The verification of “unreasonable” transitional credit claims would be conducted in four phases.  CBEC sources said that credit verification will remain one of the focus areas in FY19.     

“In order to check “frivolous and fraudulent” transitional credit claims, the CBEC has shared with field offices the list of 50,000 taxpayers whose claims would be further scrutinised,” said senior CBEC officials.

 

In the first phase, the tax officers will verify transitional credit claims where the growth is more than 25 per cent or the credit availed is in excess of Rs 25 lakh. This verification is to be completed by June and a status report has to be given to CBEC by July 10. One-third of the remaining claims of 50,000 taxpayers will be verified in each of the three phases — July-September, October-December and January-March (2019).

Taxpayers who have claimed transitional tax credit of more than Rs 25 lakh and have reported 25 per cent increase in such claims are also likely to be asked to submit a detailed statement of purchases during October 1, 2016, to June 30, 2017, the source said.

 

Tags: cbec, gst