More firms may be approached by the taxman to collect goods and services tax. India Inc, which has already received a huge number of GST notices, should brace itself for more in the coming weeks.
Experts predict that, with the restriction period for such notices for 2018-19 ending on December 31, the GST department will issue more such notices.
The large number of GST notices for non-fraud cases sent to registered persons for FY18, according to Bimal Jain, Founder of A2Z Taxcorp LLP, vaguely demand on the basis of comparison of GSTR 1, GSTR 2A, and GSTR 3B with GSTR 9 and GSTR 9C, on or before the September 30 deadline, which was the limitation period for issuance of show cause notices under section 73 of the CGST Act for FY18.
According to him, such registered persons now have no choice but to react by December 31 in order to prevent an ex-parte order.
"Further, more notices are likely to be issued over the next few months ahead of December 31, 2023 by when the limitation period for issuance of show cause notices for all non-fraud cases for FY19 will come to an end," Jain went on to say.
According to reports, corporations have been considering various alternatives after receiving GST notices, and industry and trade organizations are also considering whether to make recommendations to the government.
"These notices belie efforts at ease of doing business as companies are simply being sent notices for payment of GST dues in order to meet the deadline of September 30," a different tax expert remarked.
Earlier this week, FMCG and ayurvedic products major Dabur India alerted stock markets that it had received a Rs 320.6 crore GST demand notice. By responding to the relevant authorities, the company will contest the same on the basis of significant merits.
While the online gambling industry is already being investigated by GST officials, a number of other companies in industries such as insurance and cars have received GST letters in recent months.
On October 11, the Life Insurance Corporation of India announced that it had received a GST notification requiring it to pay tax at a lower rate of 12% rather than 18%. The total sum of the demand order cum penalty notice for 2019-20 is almost Rs 37,000 crore.
Similarly, Maruti Suzuki recently received a show-cause notice from the GST authorities seeking to demand interest and penalty, in addition to appropriating tax previously paid, totaling Rs 139.3 crore from July 2017 to August 2022.
