GST Notices Worth Over Rs 80,000 Crore Issued for Assessment Year 2018-22
The Goods and Services Tax (GST) authority’s investigation arm has sent out more than 20,000 notices across India for assessment years 2017-18 to 2021-22. The estimated tax demand associated with these notices exceeds Rs 80,000 crore. These notices cover a wide range of issues, including alleged tax payment shortfalls, input tax credit (ITC) reversals, and the interpretation of legal provisions affecting numerous taxpayers and businesses. The majority of show-cause notices were time-barred for the assessment year 2017-18 by August 5.
The investigation agency was tasked with issuing notices at least six months before the end of the five-year period, leading to their dispatch before August 5. Final orders are expected by February 5, 2025.
These notices involve pre-GST issues that may or may not be converted into GST notices, depending on the companies’ responses,” stated an official familiar with the matter. Notably, the deadline for assessment year 2018-19 is June 30, 2025.
Served under Section 74 of the Central GST Act, the notices seek responses regarding alleged discrepancies between sales data reported in GST returns and that in the annual financial statements.
MS Mani, a partner at Deloitte, highlighted the essential need for businesses to respond to GST show-cause notices in a timely manner. He emphasized that such responses entail significant time and effort, including data collation, reconciliations with accounting records, and interpretation of tax data.
Stricter disclosure requirements and digitized payment systems have aided tax authorities in improving compliance. Various sectors, including foreign airlines, shipping companies, insurance firms, online gaming companies, and information technology entities, have been served with notices.
The Central Board of Indirect Taxes and Customs (CBIC) has intervened to issue guidelines promoting uniformity in GST notices and audit exercises. This move aims to create a more predictable business environment, reduce inconsistencies in audit findings, minimize litigation, and streamline the overall audit process.
A significant number of notices have been issued for fraudulent ITC, prompting the department to undertake a special drive to root out fake registrations. Approximately 1.2 trillion tax evasion cases have been detected, and around 59,000 entities identified for verification to determine their authenticity.
Income Tax Department Processes 40 Million ITRs in 15 Days
According to Revenue Secretary Sanjay Malhotra, the income tax department has processed nearly 40 million ITRs for the assessment year 2024-25 within a span of 15 days. Over 72.8 million income tax returns for assessment year 2024-25 were filed by July 31, 2024. Of these, approximately 49.8 million ITRs have already been processed, with intimations sent to taxpayers. Notably, 39.2 million ITRs were processed in less than 15 days.
CBDT Chief Announces Review of Income Tax Act
During an event marking the 165th year of Income Tax in India, CBDT Chairman Ravi Agrawal stated that the comprehensive review of the Income Tax Act of 1961 will be completed within six months. This review aims to reduce litigation and provide tax certainty to taxpayers.
PTI