Rs. 2250 cr tax evasion: DGGI sends notice to HDFC Bank, Policybazaar, Go Digit

by B2B Desk 2023-04-14 06:13:08

The Directorate General of GST Intelligence (DGGI) has recently sent notices to three major companies, HDFC Bank, Policybazaar, and Go Digit, for alleged tax evasion amounting to Rs. 2250 crores. The notices have been sent based on an investigation conducted by the DGGI, which found that these companies had claimed input tax credit (ITC) fraudulently.

ITC is a mechanism in the GST system that allows businesses to claim credit for the taxes paid on inputs used in the production or provision of goods and services. The ITC is meant to ensure that the final tax liability is only on the value added at each stage of the supply chain, and not on the taxes already paid on the inputs.

However, the DGGI has found that these companies had claimed ITC on fake invoices issued by shell companies, which were not engaged in any genuine business activities. The DGGI has also alleged that these companies had availed of ITC on purchases made from non-existent dealers and had used it to reduce their tax liability.

The DGGI has issued notices to these companies under Section 74 of the Central Goods and Services Tax Act, which allows for the recovery of any tax not paid or short-paid along with interest and penalty. The companies have been asked to respond to the notices within 30 days and to provide relevant documents and information to support their claims of ITC.

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The DGGI's action against these companies is part of its ongoing crackdown on tax evasion and fraud in the GST system. The government has been taking a number of steps to curb GST evasion, including the introduction of e-way bills, a unified tax payment portal, and stricter penalties for non-compliance.

The alleged tax evasion by HDFC Bank, Policybazaar, and Go Digit, if proven, is a serious offense that undermines the integrity of the GST system. It is important for businesses to comply with the GST regulations and to ensure that their ITC claims are genuine and supported by proper documentation.

The DGGI's action against these companies sends a strong message that tax evasion will not be tolerated, and businesses must be vigilant and comply with the GST regulations. The government's efforts to curb GST evasion will help to increase revenue collections and ensure a level playing field for all businesses.

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