Indian one hundred rupee banknotes are held for an arranged photograph in New Delhi (Photographer: Prashanth Vishwanathan/Bloomberg)

Revenue Authorities Step Up Efforts To Make Firms File GST Returns Within Deadline

With only 65 percent of Goods and Services Tax returns filed on time, the revenue department is sending notices to non-filers through emails asking them to submit returns within three days of the expiry of the deadline despite the 15-day time limit, tax experts said.

The due date for filing GST summary returns for a month is the 20th day of the subsequent month, but many businesses registered under the GST file after the deadline by paying late fee and penalty.

Tax experts said these emails are automated and system-generated and the time limit given to file returns vary from immediately to three days to 15 days.

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In one such notice sent to a 'return defaulter' for not filing GSTR-3B or the summary sales returns, revenue authorities asked the taxpayer to furnish the return for a particular month "within three days, failing which the tax liability would be assessed under the GST Act, 2017".

"In addition to the tax assessed, you will be liable to pay interest and penalty as per provisions of the Act," the notice read.

AMRG & Associates Partner Rajat Mohan said under the GST laws, in case a registered person fails to furnish a return, a notice can be issued requiring him to furnish such return within 15 days.

"However, as seen in several cases a taxpayer is given meagre three days (including holidays) to submit GSTR–3B. These notices issued electronically and automatically seems to be suffering from judicial overreach, as it has foregone the mandatory 15-day period for taxpayers to respond," Mohan said.

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Deloitte India Partner MS Mani said the notices for non-submission of the GST returns would improve the compliance level significantly. "These notices indicate that the tax authorities have started keeping a watch on the non-filers or occasional-filers, who may not be able to escape the tax net in future," he said.

As per official data, while 57.69 percent of the GST returns for July were filed within the due date, the figure has now gone up to 96.10 percent.

For August and September, the percentage of returns filed within due date was 36.98 percent and 50.29 percent, which has gone up to 93 percent and 91 percent respectively.

Similarly, for the month of January and February, about 65 percent and 64 percent of the returns were filed within due date, and the number has now crossed 81 percent and 77 percent respectively.

For March, 62.63 percent of GSTR-3B returns were filed within due date, which had gone up to 69.5 percent on April 30 – the last date for calculating tax mop-up during the month.

EY India Partner Abhishek Jain said with the data analytics suggesting non-filing of returns by some percentage of registered taxpayers, the government should inspect the reasons for such default. "The current notices issued to such defaulters being the opening move," he said.

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