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GST: Baffled tax department to probe Rs 65,000 cr credit claims of traders
New Delhi, Sep 15 (IANS) Transitional credit claims worth a whopping Rs 65,000 crore received from traders under GST have stumped the government and the tax authorities are now preparing to check the veracity of claims of over Rs 1 crore.
The Central Board of Excise and Customs (CBEC) has asked its officials to verify all transitional credit claims for more than Rs 1 crore as it does not rule out ineligible claims “due to mistake or confusion”.
If the entire Rs 65,000 crore transitional credit claims are found genuine, it could burn a deep hole into the anticipated revenue collections under GST. Apart from transitional credit, government would also receive claims for input tax credit, the figure of which is not yet known. Finance Minister Arun Jaitley had said that the government had collected Rs 95,000 crore as GST for July with 64 per cent compliance.
“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,” Mahender Singh, Special Secretary and Member, CBEC, has written in a letter to Chief Commissioners across the country.
A list of assessees in the Delhi region, who have claimed more than Rs 1 crore as credit in their Tran-1 showed a firm even claiming up to Rs 228.82 crore as transitional credit.
“The carry-forward of transitional credit is permitted only when such credit is also permissible under the Goods and Services Tax (GST) law. It is required that such credit be verified to ensure that only eligible credit is carried forward,” Singh said in the letter.
Such a verification would include matching the credit claimed with closing balance in returns filed under the earlier laws and checking the eligibility of credit under GST regime.
“It is desired that the same should be done at the earliest with regard to assessees under your jurisdiction and a report sent to this office by September 20,” the letter says.
The transitional credit claims of Rs 65,000 crore are only for Central GST. The states may also follow a similar examination and verification process of claims received under State GST.
Listing out the key reasons for the staggering claims of transitional credit, GST expert Pritam Mahure told IANS: “One, it could be pertaining to closing stock lying with the manufacturers and traders (such as cars and electronics lying with dealers).
“Second, in certain cases, due to invert duty structure (mainly in pharmaceutical industry), many taxpayers had substantial excise duty credit balances, which may have been claimed as transitional credits. Third, the government had allowed traders to avail excise duty credit on the one-year-old stocks, which was not available to them earlier.”
Experts also suggested that traders should themselves review their claims, before the government initiates scrutiny and subsequent action.
“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,” Jigar Doshi, Partner, SKP Business Consulting, said.
–IANS
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Dr. Abhishek Verma Dedicates a Shelter in Memory of His Mother, Veena Verma, at KGMU; Inaugurated by Daughter Nicolle Verma
World-renowned business tycoon Dr. Abhishek Verma has supported Foodman Vishal Singh’s Hunger-Free World mission. In memory of his mother, Late Veena Verma, who was a 3 term Rajya Sabha MP.
Dr. Verma dedicated a state-of-the-art free permanent shelter for the attendants of patients at KGMU Medical University, Lucknow, under the aegis of Vijay Shree Foundation. His daughter, Nicolle Verma, inaugurated the shelter.
During the event, Foodman Vishal Singh honored Nicolle Verma by presenting her with a memento. Mrs. Nidhi Sharma and Avantika Yadav, associated with the organization, welcomed her with garlands. Following this, Nicolle Verma distributed essential items to the attendants and also handed out fruits. She became emotional remembering her grandmother on her birth anniversary.
On this occasion, she also inaugurated the “Veena Verma Sevalaya” in memory of her grandmother, Veena Verma, to serve the attendants. She expressed, “I feel proud that my family is engaged in nation-building as well as social service. Today, in collaboration with Vijay Shree Foundation founder Foodman Vishal Singh Ji, I feel immensely proud to dedicate this shelter for the poor, helpless, and needy attendants of patients battling serious illnesses like cancer. I am honored to be associated with the Hunger-Free World Mission for humanity.”
Inspired by the continuous humanitarian service provided by Vijay Shree Foundation over the past 17 years, Nicolle Verma donated 10 lakh rupees to support the cause. The purpose of this donation is to ensure that services continue for the needy attendants of patients suffering from severe illnesses in hospitals, as facilitated by Foodman Vishal Singh.
It is noteworthy that Dr. Abhishek Verma’s family has a legacy of public and philanthropic service. They are helping millions to carry forward the values and service work of their parents. On the occasion of his mother’s birth anniversary, Dr. Abhishek Verma dedicated this state-of-the-art permanent shelter at Lucknow Medical College to serve the attendants of patients through the Vijay Shree Foundation.
Supporting Foodman Vishal Singh’s Hunger-Free World mission, Dr. Abhishek Verma assured that he would continually support keeping this flame of humanity alive. He also promised to assist in providing medicines to the helpless patients.
Continuing her grandmother’s legacy of service, Nicolle Verma personally served food to the needy patients and attendants. She said, “It is our good fortune to have received the joy of doing this noble work today through Foodman Vishal Singh. I have taken another step forward in carrying my family’s values and cooperation by joining hands with the Vijay Shree Foundation. My father taught me to serve and help the needy, and I feel happy when I bring a smile to someone’s face.”
On the birth anniversary of the late Veena Verma, the event organizer, Vijay Shree Foundation founder Foodman Vishal Singh, said, “We feel proud and happy that Dr. Abhishek Verma, a globally renowned business tycoon, has extended his support to uplift our country from the hunger index. Today, on his mother’s birth anniversary, he inaugurated a state-of-the-art permanent shelter at Lucknow Medical College, which will always be helpful for the needy attendants of patients. It is a pleasure for me and the organization to receive the affection of Mr. Verma.”
The event was attended by General Manager Verma Family Office Hemant Garg, Sonu Rajput, and the organization’s volunteers, including Sandeep Singh, Parmeshwar Ji, Prashant Rao Gautam, Balram Singh, Ramesh Chaudhary, Suman, Jeetu, Anil, Suraj, Vinay, Manish Bhadauria, Manas Mehrotra, Vivek, Apurv, Happy, and others.
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