Category: GST News

The Central Bureau of Investigation (CBI) has taken decisive action by apprehending a senior official from the Goods and Services Tax (GST) department in Mumbai. This official, identified as Hemant Kumar, holding the position of Superintendent at the Bhiwandi Commissionerate, was arrested on charges of soliciting and receiving a bribe of Rs 5 lakh. The arrest comes after allegations surfaced of Hemant Kumar seeking an illicit advantage of Rs 30 lakh from a complainant in exchange for resolving a pending GST case for a company.

However, investigations revealed that the accused engaged in negotiations that led to the bribe amount being lowered to Rs 15 lakh. In a strategic move, CBI officials set a trap that culminated in the arrest of Hemant Kumar while he was accepting the initial sum of Rs 5 lakh from the complainant. This was part of the larger bribe amount of Rs 15 lakh that he had allegedly demanded.

Following the arrest, searches were conducted at both Hemant Kumar’s office and residence. CBI officials managed to recover a substantial sum of Rs. 42.70 lakh in cash, alongside various documents pertaining to the accused’s assets, and other incriminating materials.

Subsequently, Hemant Kumar was presented before a special CBI judge, who remanded him to police custody until August 21. This resolute action by the CBI underscores their commitment to upholding justice and combating corruption within the government system.

Maharashtra’s GST revenue surge paints a striking picture, with an unwavering 18% growth from April through July in the current fiscal year. In contrast, the national expansion hovers modestly between 11% and 12%. This remarkable achievement in revenue stands as a testament to Maharashtra’s fiscal resilience. Notably, the state’s financial prowess was manifest in its INR 33,196 crore ($4.6 billion) revenue in April, experiencing a temporary dip in May but rallying in June and July.

The driving forces behind this commendable surge are twofold: the robust performance of the service and manufacturing sectors and the vigilant endeavors of the central government to stymie tax evasion. This symbiotic collaboration between sectors and government strategy has propelled Maharashtra’s 2022-23 GST revenue to a noteworthy INR 2,70,346 crore, constituting a formidable 15% of the nation’s entire collection.

Delving into the specifics of these months, April’s revenue alone, tallying at ₹33,196 crore, exhibits a robust 20.74% growth compared to the corresponding period in the previous fiscal year. A momentary stumble materialized in May, yielding a revenue of ₹23,536 crore, with a 15.87% deficit. However, this setback proved ephemeral, as June and July witnessed resurgent growth, culminating in revenues of ₹26,098 crore (16.82% growth) and ₹26,064 crore (17.78% growth), respectively.

In contrast, the nation’s growth during these four months registered at 12% for April, May, and June, dwindling slightly to 11% in July. Maharashtra’s State Goods and Services Tax (SGST) collection, ranging between ₹7,409 crore and ₹10,392 crore, further bolstered by a monthly contribution of roughly ₹3,500 crore from integrated GST, underscores the state’s consistent financial vibrancy.

State officials project lofty aspirations, aiming for a monthly collection of ₹11,337 crore against an annual target of ₹1,36,041 crore set by the state government. Remarkably, the current collection already surges above expectations by more than 7%, suggesting an eventual rise exceeding 12%.

The exhilarating growth, exceeding both state government projections and national benchmarks, finds its genesis in the stellar performance of the service and manufacturing sectors. These sectors, constituting the bedrock of the state’s GDP, remain the fulcrum upon which GST growth pivots. The central government’s prudent employment of business intelligence tools to staunch tax evasion further contributes to this financial crescendo, propelling Maharashtra’s revenue trajectory.

A forward-looking perspective maintains this growth momentum, bolstered by the impending election year. Historically, elections invigorate the economy with an infusion of capital, and this forthcoming electoral season is poised to be no exception. The central government’s emphasis on infrastructure development, with Maharashtra as a prominent beneficiary, will undoubtedly sustain the state’s economic acceleration, defying any prospects of stagnation.

In retrospect, the preceding fiscal year bore testimony to Maharashtra’s fiscal eminence, with a staggering GST collection of ₹2,70,346 crore, dwarfing the second and third contenders, Karnataka (₹1.2 lakh crore) and Gujarat (₹1.1 lakh crore) by a considerable margin. This financial prowess cements Maharashtra’s reputation as a financial juggernaut, poised to continue its upward trajectory with unabated vigor.

A distressing incident unfolded as a 49-year-old truck driver, en route to Punjab after learning about his son’s tragic passing, was apprehended by State Goods and Service Tax (SGST) authorities on GT Road. The unfortunate turn of events culminated in the driver’s demise within his vehicle that same night, reportedly due to the overwhelming shock he experienced.

Balbir Singh, hailing from Ludhiana’s Aslamganj, was returning from Kanpur with a load of goods from the Koyla Nagar region. It was during this journey that he received the heart-wrenching news of his son Mahesh’s accidental death, caused by electrocution.

As Balbir Singh made his way home to bid a final farewell to his son, he was intercepted by Joint Commissioners of GST SIB, Amit Mohan, and Parasnath Yadav, who were conducting a routine inspection near Geeta Nagar Metro station in Kanpur around 1:30 pm on a Friday afternoon.

Despite his earnest appeals, the officials declined Balbir Singh’s plea to return home and pay his respects to his son for the last time.

In an unwarranted turn of events, the officials forcibly transported Balbir Singh and his truck to the GST office in Lakhanpur. Tragically, Balbir Singh was discovered lifeless in his truck when the officers approached him to deliver a notice on Sunday afternoon.

Upon learning of his father’s untimely demise, Govind, Balbir Singh’s elder son, promptly journeyed from Ludhiana to Kanpur, accompanied by his brothers-in-law Sonu and Bharatram. After identifying his father’s body, Govind swiftly demanded action against the GST officers responsible.

“My younger brother, Mahesh, lost his life due to electrocution. Upon receiving this grievous news, my father rushed to Kanpur. However, the GST officers obstructed his journey, compelling him to their office. The profound sorrow and shock of being denied the opportunity to bid his own son a final farewell proved too overwhelming for him,” Govind expressed.

Additionally, Govind shared that he had refrained from informing his mother about Balbir Singh’s demise, fearing the tremendous shock of losing her husband and son in such a brief span of time.

“The insensitivity displayed by the GST officers has shattered our entire family. It is imperative that strict measures are taken against them,” he asserted.

Outrage Erupts, Protest Unfolds at GST Office

This tragic incident has ignited fury within the local business community, prompting them to organize a protest at the GST office. Gyanesh Mishra, the president of Akhil Bharatiya Vyapar Mandal, demanded immediate compensation for Balbir Singh’s grieving family and called for decisive action against the SGST officers accountable for this grievous outcome.

Legal proceedings have been initiated against the involved GST officers, with a further investigation underway.

Ashneer Grover, a prominent figure in the Indian tech landscape and co-founder of BharatPe, has fiercely criticized the recent decision of the GST Council to impose a heavy 28% Goods and Services Tax (GST) on online gaming. This decision holds significant consequences for various gaming companies, such as Dream11, MPL, Gameskraft, and Games 24×7.

In a fervent tweet, Grover lambasted the government’s move to levy the highest GST rate on online games, labeling it as a potential obliteration of India’s thriving gaming sector. He argued that this abrupt imposition necessitates tech startup founders to delve into politics, underlining the urgency for their voices to find resonance. Grover’s apprehensions are tightly intertwined with his own venture, Crickpe, a mobile game centered around fantasy cricket. Crickpe allows users to not only indulge in the game but also to earn money through paid leagues and victorious cash pools.

With unmistakable frustration, Grover tweeted, “Farewell – Genuine currency gaming industry in India. If the government believes that people will stake Rs 100 to participate in a Rs 72 prize pool contest (bearing 28% Gross GST), and if they pocket Rs 54 (after accounting for platform fees), they will then be subjected to a 30% TDS on that amount – an imposition that supposedly grants them an indoor swimming pool during the first monsoon – an absurd notion!

His tweet goes on to assert, “It was an enjoyable journey being part of the fantasy gaming industry, which now stands vanquished. $10 Billion squandered in this season of downpours. It’s time for startup pioneers to step into the realm of politics and secure representation – lest we witness one industry’s downfall after another.”

Grover’s pointed remarks were a direct response to the GST Council’s decision to enforce a 28% tax on online gaming. This elevated tax rate will be applicable to the entire value of transactions within the sphere of online gaming. This move will inevitably impact multiple gaming entities, including Dream11, MPL, Gameskraft, and Games 24×7.

Echoing Grover’s sentiments, India’s most seasoned and extensive online gaming consortium, the All India Gaming Federation, along with the E-Gaming Federation and the Federation of Indian Fantasy Sports (FIFS), have expressed their displeasure with the council’s decision to raise the GST on online skill games from 18% to 28%.

In a collective statement, these three industry bodies have expressed their concern about certain media reports hinting at the imposition of taxes on the overall prize pool (inclusive of pooled prize money and platform commissions), rather than solely on the Gross Gaming Revenue (GGR). They opine that if the latter scenario unfolds, it could spell doom for the online skill gaming sector in India.

Roland Lander, CEO of the All India Gaming Federation, articulated in a statement that the combination of heightened tax rates and the imposition of taxes on the entire entry fee (as opposed to GGR) would prove “catastrophic for the industry, stifling its potential right at its inception.

A post from a Bengaluru resident has caught the attention of the internet. Sanchit, employed as a category manager at Flipkart, took to Twitter to express his frustration. He stated that he’s required to give 30% of his income as tax to the government, leaving him with only a small portion for his own needs.

Even when he attempted to purchase caffeinated beverages with the money that remained, he encountered an additional 28% tax. This made him realize that he was putting in long hours of work just to contribute more than 50% of his earnings to the government. Sanchit shed light on the burden faced by those who earn a salary.

In another tweet, Sanchit shed further light on the taxes imposed even on basic necessities like sugar, cream, and a chocolate bar. By breaking down the tax calculations, he pointed out that the government collects around 27.5% of the final cost of a chocolate bar through different taxes, including an 18% GST on sugar, cocoa, condensed milk, and cream.

Sanchit’s tweets have garnered significant attention online, with Twitter users sharing their own grievances. While some segments of the internet agreed with him, others held differing opinions.

Several users underscored how taxes impact middle-class salaried individuals, highlighting that a significant portion of their work is dedicated to fulfilling tax obligations.

Explore a few reactions below:

Feel free to share your own thoughts in the comments section.

Cinema-goers are in for a pleasant surprise as the Goods and Services Tax (GST) Council has taken a significant step to make the cinema experience more affordable. By reducing the service tax on food and beverages enjoyed within cinema halls from 18% to a mere 5%, the Council, under the leadership of the Union finance minister and representatives from states and UTs, has ensured that relishing popcorn and cold drinks at the movies won’t dent wallets as much.

This decision carries a substantial positive impact for both movie enthusiasts and the cinema industry itself. Particularly, multiplexes, which derive a substantial 35% of their earnings from this category, stand to benefit significantly from this favorable change. The move comes as a welcome respite, enabling multiplex operators to breathe new life into their businesses after the challenges posed by the pandemic.

The alignment of food and beverages under the ‘restaurant service’ definition for GST coverage at a flat rate of 5% (without the complexity of input tax credit) is a milestone welcomed by the entire cinema industry. A statement from the news agency PTI quoted industry insiders expressing their contentment with the resolution. It is anticipated that this clarification will usher in a sense of tax predictability, thereby mitigating the potential for disputes or litigation stemming from GST matters. This development, in turn, is poised to play a pivotal role in rejuvenating the theatre business, which has been striving for recovery post the pandemic.

The cinema exhibition sector encountered significant hardships due to the pandemic’s impact. The enforced closures throughout 2020 and subsequent resumptions under restrictions took a toll. However, the tide shifted in March 2022 as operations resumed at full capacity, and fresh content began to flow, rekindling hope within the industry.

In a parallel decision, the Council has also agreed to levy a 28% GST on online gaming, horse racing, and casinos, showcasing a diversified approach towards taxation.

A stirring incident has come to light involving Devendra Kumar, a 22-year-old laborer hailing from Udaygarhi Bangar in Uttar Pradesh. This tale unfolds with a GST notice unexpectedly landing on his doorstep, asserting that his humble businesses had supposedly yielded a staggering turnover of Rs 1.36 crore during the fiscal year 2022-23. What adds to the intrigue is Devendra’s revelation that the subsequent GST liability he is burdened with amounts to a substantial Rs 25 lakh.

This puzzling narrative prompted action from the Gautam Buddha Nagar Police, who swiftly launched an investigation following a complaint lodged by a fellow laborer in Bulandshahr. The complainant, whose identity remains veiled, contended that he had been slapped with a GST notice, hinting at an impressive business turnover during the same period. This spurred the investigative machinery into motion, prompting a transfer of the case from Bulandshahr to the Sector 63 police station in Gautam Buddh Nagar.

The heart of the matter is Devendra’s brief stint as a helper at a private firm located in Noida’s Sector-63 during 2021. His engagement spanned a mere four months, during which his personal details, namely Aadhar and PAN, were recorded for the purpose of salary disbursement. Fast forward to March 13, 2023, when a missive from the state tax office reached Devendra’s hands. To his astonishment, the letter stated that a business under the name “JK Traders,” ostensibly associated with him, had achieved a colossal annual turnover of Rs 1.36 crore in the financial year 2022-23. Accompanying this revelation was a demand for GST payment amounting to a substantial Rs 24.61 lakh.

Scrutiny of the details presented in the tax notice led Devendra to an unsettling discovery: the GST number provided belonged to a certain Jitendra Sisodia from Ghaziabad. This revelation forms the foundation of Devendra’s assertion in his filed FIR, wherein he accuses the company contractor and Jitendra Sisodia of exploiting his Aadhar and PAN particulars to concoct a new business under his name.

The wheels of justice are now in motion, with the authorities invoking sections 420 (cheating), 468, 467, and 471 (all associated with fraud) of the IPC. These actions are taking place at the Sector 63 police station in Gautam Buddh Nagar, where a determined investigation into this web of deceit is underway. This saga serves as a stark reminder of the complexities that can arise in a world increasingly reliant on digital documentation and financial mechanisms.

The Central Board of Indirect Taxes and Customs (CBIC) has taken a proactive stance in its pursuit to eradicate deceptive accounts within the Goods and Services Tax Network (GSTN). The outcomes of this concerted endeavor have unveiled a startling truth – nearly a quarter, roughly 25%, of the identified entities, who have wrongly taken advantage of benefits amounting to approximately ₹15,000 crores, either lack existence or have mysteriously disappeared, as reported by The Times of India (TOI).

These revelations concerning the suspects’ identification stem from assiduous scrutiny of a vast database that enlists an astonishing 1.4 crore GST contributors.

Employing advanced artificial intelligence and data analysis techniques, the authorities meticulously combed through a list of around 69,000 suspects. Over the course of an ongoing two-month operation, the investigation has effectively brought to light 17,000 counterfeit accounts that have exploited fabricated input tax credits, as stated by the publication.

It’s noteworthy that the inquiry extends across the spectrum of entities involved in the supply chain, including prominent players in the business landscape. For instance, it has come to attention that a prominent food delivery service provider has utilized services from non-existent entities. It’s pertinent to mention that previous similar initiatives have also exposed analogous instances of misconduct.

Insiders from the government, sharing information with TOI, have revealed that Delhi stands out with a commendable success rate, particularly in uncovering a significant number of falsified registrations.

Expanding on the recent crackdown, CBIC is now devising strategies for regular evaluations aimed at preventing the misuse of benefits. Furthermore, the agency intends to reinforce regulatory measures by rolling back certain flexibilities that were introduced to ease tax payment obligations for suppliers amidst the pandemic.

Senior officials have confirmed to TOI that decisions pertaining to these matters have already been endorsed by the GST Council, with implementation underway. The overarching goal remains to curtail leakages and bolster the system’s integrity.

This subject is anticipated to be thoroughly discussed in the upcoming GST Council meeting, during which comprehensive details will be shared with state finance ministers. Nevertheless, officials have categorically dismissed the notion of imposing stricter registration criteria, asserting that the primary emphasis is on streamlining the process for honest taxpayers, rather than burdening them with unwarranted compliance.