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CBIC for physical verification of entities to check invoicing fraud

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The Central Board of Indirect Taxes & Customs (CBIC) proposes to carry out physical verification of the entities that have been granted a deemed GST registration sans Aadhaar authentication in a bid to counter fake invoice frauds.

The department of revenue (DoR) in the Finance Ministry had come out with Standard Operating Procedure (SOP) ‘instructions’ to be followed by the tax officers for carrying out the physical verification of entities that will be required in order to ensure authenticity.

The SoP has been finalised as part of the strategy to counter GST fake invoice frauds via search and surveys leading to arrests and booking of cases against fake entities involved in availing and passing on input tax credit (ITC) fraudulently.

CBIC sources said that this SOP would effectively curb the fake invoices menace and ITC frauds while at the same time this would ensure proper facilitation of ease of doing business for the genuine applicants/entities without any overreach. This is the further follow up of the high level review meeting that was held in DoR recently.

Meanwhile, according to the Directorate General of GST Intelligence (DGGI) sources, the DGGI and CGST Commissionerates have so far arrested 92 persons for availing or passing on ineligible ITC fraudulently through fake invoices and have booked 994 cases against more than 3161 fake GSTIN entities identified across the country during its ongoing nationwide drive launched in the second week of November against GST fake invoice frauds.

CBIC Sources in the know of the matter said that an entity having deemed registration where the applicant either has not opted for Aadhaar authentication or where such authentication has failed, has to go for mandatory physical verification of the premises, or in cases where the physical verification is difficult, certain additional documents may be called for verification by the tax officer (upon approval of an officer not below the rank of Joint Commissioner) before deciding upon grant of registration.

According to CBIC Sources, the Board in an “Instruction” to its field formations has said that the registrations granted sans Aadhaar authentication during the period from August 21 to November 16 on deemed basis require verifications to ascertain that they have genuine business or intends to carry out so. All such deemed registrations would be subjected to compulsory post registration verification and the list of such deemed registrations would be circulated zone wise to the field formations for confirmation which has to be completed in a time bound manner within three weeks and a weekly status report has to be submitted to the Board.

Sources said that pending the physical verification, notice in FORM REG-17 may be issued in specific cases based by the proper officer on certain risk parameters seeking explanation from the registered person regarding the differences and anomalies noticed, if any, where FORM GSTR-1 is filed and FORM GSTR-3B is not filed either for August or September, 2020 tax period and where the difference in tax amount, as reported in FORM GSTR-1 and FORM GSTR-3B is more than Rs one lakh.

On receipt of the reply to the notice, the proper officer would complete the proceedings as per the CGST Rules. Also, in the interest of revenue, the tax officer in addition to the physical verification may further carry out the preliminary financial verification of the registrants by seeking certain documents.

Business

Decline in equities continue for 4th straight sessions

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The 30-scrip Sensitive Index (Sensex) and broader 50-scrip Nifty on the National Stock Exchange (NSE) extended their losses from the previous three consecutive sessions and declined on Friday.

At 10.25 a.m., Sensex traded at 58,593 points, down 0.9 per cent from the previous close of 59,464 points. It opened at 59,039 points.

Nifty traded at 17,599 points, down 0.9 per cent from the previous close of 17,757 points. It opened at 17,613 points.

Bajaj Finserv, Tech Mahindra, Coal India, Adani Ports, Bharti Airtel were some of the top losers, NSE data showed.

Top gainers during the early trade were Hindustan Unilever, Tata Consumers, Bajaj Auto, Hero MotoCorp, and Power Grid Corporation.

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Consumer Price Index numbers for Agri, Rural labourers up by 5 points in Dec 2021

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The All-India Consumer Price Index Numbers for Agricultural Labourers (CPI-AL) and Rural Labourers (CPI-RL) for the month of December 2021 increased by 5 points each to stand at 1097 and 1106 points respectively.

The major contribution towards the rise in general index of Agricultural Labourers and Rural Labourers came from Fuel & Light group and miscellaneous group to the extent of 1.72 & 1.58 points and 1.02 & 1.06 points respectively mainly due to rise in prices of firewood, kerosene oil, medicine, barber charges, bus fare, toilet soap, washing soap, etc., a release from the Ministry of Labour and Employment said on Thursday.

The rise/fall in the index varied from state to state. In case of Agricultural Labourers, it recorded an increase of 1 to 20 points in 11 states and a decrease of 1 to 12 points in eight states while it remained stationary for Odisha. Tamil Nadu with 1,290 points topped the index table whereas Himachal Pradesh with 861 points stood at the bottom.

In case of Rural Labourers, it recorded an increase of 1 to 20 points in 11 States and a decrease of 1 to 14 points in eight states while it remained stationary for Odisha. Tamil Nadu with 1,276 points topped the index table whereas Himachal Pradesh with 915 points stood at the bottom.

Amongst states, the maximum increase in the CPI-AL and CPI-RL was experienced by Tamil Nadu (20 points each), mainly due to rise in the prices of vegetables & fruits, onion, chillies green/dry, tamarind, etc.

On the contrary, the maximum decrease in the CPI-AL and CPI-RL was experienced by Himachal Pradesh (12 points and 14 points respectively), mainly due to fall in the prices of wheat atta, pulses, onion, vegetables, and fruits etc.

Point to point rate of inflation based on the CPI-AL and CPI-RL stood at 4.78 per cent & 5.03 per cent in December 2021, compared to 3.02 per cent & 3.38 per cent respectively in November 2021 and 3.25 per cent and 3.34 per cent respectively during the corresponding month of the previous year.

Similarly, Food inflation stood at 2.99 per cent & 3.17 per cent in December 2021, compared to 0.88 per cent & 1.07 per cent respectively in November 2021 and 2.97 per cent & 2.96 per cent respectively during the corresponding month of the previous year.

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Air India to commence normal ops to US from Friday

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National carrier Air India will commence normal operations to US from Friday, the airline said.

On Tuesday, the national carrier said that it will not be able to operate a number of US-bound flights due to the deployment of 5G communications in the US.

As per industry insiders, the 5G network technology might cause certain crucial flight instruments to malfunction.

The airline informed passengers via its official Twitter handle: “#FlyAI : Flight operations to/from destinations in USA were affected during last two days.

“We would like to inform our passengers traveling to/from destinations in the USA that effective 0001hrs of 21st January 2022 normal flights operations will recommence to/from USA.”

Earlier in the day, Boeing had cleared AI to operate to the US on Boeing 777 aircraft.

Accordingly, the first Air India flight left from New Delhi to JFK airport on Thursday morning.

Besides, Air India is expected to operate other flights to Chicago and San Francisco.

“Arrangements to carry stranded passengers are being worked out,” the airline said.

The US air transport regulator, Federal Aviation Administration (FAA), has been concerned that a version of 5G could interfere with some airplane instruments.

Earlier, aviation industry groups had shared those fears. This is despite reassurances from federal telecom regulators and well as wireless carriers.

Specifically, the FAA has been worried that 5G cellular antennas near some airports – not air mobile devices – could throw off readings from some aircraft equipment designed to tell pilots how far they are from the ground.

The systems, radar altimeters, are used throughout a flight and are considered critical.

At present, Air India operates to 5 destinations in the US.

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