GST: Aadhaar verification to be mandatory for new dealers

GSTN said those who do not want to give their Aadhaar numbers would have to undergo physical verification.

Illustration: Dominic Xavier/Rediff.com

The GST Network on Saturday decided to make Aadhaar authentication or physical verification mandatory for new dealers from January 2020 to check malpractices in Goods and Services Tax.

"Aadhaar authentication of new registered dealers will be mandatory. Earlier it was optional.

“But we have noticed in two years that large number of fly-by-night operators are registering themselves as GST dealers.

“They make fake invoices also," Bihar deputy chief minister Sushil Kumar Modi, who heads the group of ministers of GST Network, told reporters.

The GSTN, he said, had decided that from January 1, 2020, all new dealers enrolling will have to have Aadhaar authentication.

Infosys was given the contract to prepare the programming, software, among others, he added.

Modi said those who do not want to give their Aadhaar numbers would have to undergo physical verification.

"In both cases, GST number will be given within three working days of Aadhaar authentication and physical verification," Modi added.

In the first phase, Aadhaar authentication will be mandatory for new dealers.

Afterwards, all those enrolled on GSTN would be asked to provide their Aadhaar numbers.

As refunding was a big issue, especially in the last 30 months after the launch of GST, they had decided on completely going online for it from September 24 this year from a single source, either by the Central GST or state GST, Modi said.

He said most of the processes done manually lacked transparency and took a longer time.

"After the online process, dealers will get payment from the Public Finance Management System," Modi said.

Exporters did not suffer much as their payments were through IGST and they got refunds within six to seven days.

Till date Rs 93,416 crore were refunded to them, he said.

The GSTN also recommended launch of the much simplified new return system from January 1, 2020, as the earlier one was a bit complicated, Modi said.

It (new return), in three formats of Sahaj, Sugam and Normal, would be rolled out in one go for all types of taxpayers put together, he said, adding that the annual return date has also been extended to November 30, 2019.

Sushil Kumar Modi said that among the 92.58 lakh registered dealers, only 64.17 lakh were entitled to file their returns as they had submitted the 3B and GSTR-1 forms.

Of the 64.17 lakh, only 21.35 lakh had filed their returns, which worked out to 33 per cent.

"The GST council has to take a call on what to do with these non-filers as their numbers are very low," he said.

"We are getting a number of suggestions to simplify the return filing process.

“So the GST council will decide how to simplify the return filing system," Modi said.

He said those not filing their returns for two months would have their E-Way bills blocked, starting from November 1 this year.

"We have noticed that 27.22 lakh dealers have not filed their returns of June and July and their E-Way bill can be blocked.

“Among them, about 5.20 lakh dealers are still using E-Way bills," Modi said.

"We are giving them a chance and I will give an example of Karnataka, where 1.75 lakh are bound to be blocked.

Among them, 35,033 dealers were found using E-Way bills every month actively. So alerts were sent to these dealers, he added.

Modi said the GST Council meeting scheduled in Goa on September 20 would see members of the 15th Finance Commission attend it.

Asked whether GST would look into rationalisation of taxes for a particular sector like the automobile sector, he said the agenda has not yet been circulated.

He, however, opined that no state would be ready to give any kind of concession to this sector or any others.