Numerous GST notices issued to the taxpayers get GST notices for FY 2017-18
Goods and Services Tax (GST) Authorities across the country have sent out several thousands of notices claiming shortfalls in payment of tax for FY 2017-18. The deadline to issue notices was September 30th 2023 and the taxpayers have been given 30 days to respond to these automated notices. One may note that the tax authorities can send notices even after September 30, but they would need to prove a case of ‘tax evasion’ or ‘fraud’ on the part of the taxpayer. It is also believed that several notices appear to have been issued without proper analysis of facts and figures.
These notices largely pertain mainly due to following grounds:
- Mismatches in GST output and liability
- Input tax credit Verification
- Non – eligible tax credit claims
- Reversal of credit in case of exempt supplies
Both central and state GST authorities have sent these notices over the last fortnight, a government official said.
Taxpayers and tax professionals feel that it would lead to an increase in litigation over the next three months while hitting cash flows of companies as they would be required to furnish 10% of the total liability as a deposit for filing an appeal.
One may note that the adjudication deadline for these show cause notices is December 31 and so there will be a lot of compliance burden on the taxpayers.
If any tax demand is raised then deposit of 10% is necessary for appeal which may affect the cash flows of the litigant companies.