This move when tax liability doesn’t match with reported transaction

INDIVJAL DHASMANA

New Delhi, 22 December

Come January and the government is empowered to send its recovery officials to your premises to collect GST without notice, if your tax liability shown in the requisite form is less than what invoices, mentioned in the outward supply form, should draw.

The relevant provision in the Finance Act, 2021, will come into effect from January 1, 2022, according to a gazette notification issued on Tuesday.

Under the GST system, there are two kinds of returns that a company is required to file monthly if its turnover is over Rs 5 crore annually. These are from GSTR-1 and GSTR-3B. The former is a return that shows invoices of its sales and the latter is for declaring summary GST liabilities. While GSTR-1 is to be filed by the 11th of the following month of the transactions, GSTR-3B is to be filed by the 20th of the next month.Those with an annual turnover of up to Rs 5 crore can file quarterly returns, if they choose so.

Now, if someone has reported invoices of Rs 1 crore in GSTR-1 but showed taxes on only Rs 1 lakh of sales in GSTR-3B, the government from January onwards will be empowered to send officials to his/her business premises to recover GST on Rs 99 lakh of sales. In this case, the government is not required to give notice.

Source: https://www.userwalls.com/n/provision-jan-gst-officials-make-surprise-recovery-visits-2597608/