FinMin to block ITC for entities availing credit fake invoices

In a bid to plug revenue leaks, the Central Goods & Services Tax (CGST) administration has started blocking input tax credit (ITC) for entities, who availed credit against fake invoices, or against invoices without the receipt of goods or services, or both.

In the first nine months of FY20, the department collected over Rs 9.08-lakh crore, against Rs 8.71-lakh crore during the corresponding period last fiscal. Though there was an increase it did not meet the average monthly collection expectation of Rs 1.10 lakh crore.

The Directorate General of GST Intelligence (DGGI), under the Finance Ministry, has dispatched a letter to all the 26 field formations urging them to make a list of entities that availed fake credit and block ITC for those located in their respective jurisdictions. If the formations have data on such entities located outside their jurisdictions, they have been asked to forward a list of those, along with their GSTN particulars, to the concerned field formation with a request to block the input tax credit immediately, the letter added.