Introduction: To address problem of fake registration and fake input tax credit action on a mission mode by Central and State tax authorities in the form of a Special All-India Drive against fake registrations. In this context, it is further felt that verification of applications for registration by the proper officers is one of the most crucial steps in the direction of preventing the menace of fake or bogus registrations. Accordingly, the following guidelines are issued for strengthening the process of verification of applications for registration at the end of tax officers in a uniform manner:
- Upon receiving the registration application on the ACES-GST application, the concerned officer is required to promptly begin scrutinizing and verifying the applicant’s details.
- Authenticity of the documents furnished as proof of address may be cross-verified from the publicly available sources, such as websites of the concerned authorities such as land registry, electricity distribution companies, municipalities, and local bodies, etc.
- The proper officer shall check the risk rating made available by the DGARM in respect of the concerned ARN and take the same into consideration while verifying and processing the said application. Special attention needs to be paid to the cases where “High” risk rating has been assigned to an ARN.
- The proper officer may also check as to whether the registration(s) has been obtained on the same PAN earlier, either within the same State or other State(s).
Special attention to the cases involving inter alia the following circumstances:
- where any registration obtained on the PAN of the applicant has been cancelled/suspended/rejected previously
- whether the place of business of the applicant appears to be risky based on local risk parameters;
- whether the proof of address of place(s) of business prima facie appear to be suspicious/ doubtful on the basis of scrutiny of the application and the documents.
If application is found to be deficient officer should issue SCN within the prescribed time limit and do necessary procedures as per the provision of act.
The proper officer may seek clarification or information or document(s) inter alia in the following cases:
- where any document is incomplete or not legible, the proper officer may seek complete or legible copy of the same.
- where the address of place of business does not match with the document uploaded by the applicant, or where such uploaded document does not appear to be a valid proof of the address of the said place of business, the proper officer may seek additional documents to confirm the address details.
- where the address of place of business is incomplete or vague, the proper officer may seek complete and unambiguous details of the address along with the corresponding documentary proof.
- where any GSTIN linked to the PAN of the applicant is found cancelled or suspended, the proper officer may seek clarification or reasons for the same from the applicant, if required.
Process after issuing SCN:
- If the proper officer is satisfied with the applicant’s reply, the registration may be approved within the specified time period.
- If the proper officer is not satisfied with the clarification, information, or documents provided, the application may be rejected, and the applicant will be notified electronically, with reasons recorded in writing.
- If the applicant fails to respond to the notice within the prescribed time period, the application may be rejected, and the applicant will be informed electronically, with reasons recorded in writing.
Aadhaar number authentication is pending:
- If the applicant fails to undergo Aadhaar number authentication or does not opt for it, the proper officer will initiate the process of physical verification of the place of business.
- The concerned officer must ensure that the physical verification report, along with other documents and photographs, is uploaded on the system within the prescribed time limit.
- Even in cases where the applicant has undergone Aadhaar number authentication, if the proper officer deems it necessary to verify the authenticity of the applicant’s place of business, a time-bound physical verification may be conducted. The Centralized Processing Centre (CPC) officer or jurisdictional officers may carry out the physical verification until a functionality for marking such applications on the portal/ACES-GST application is available.
Conclusion:
- The proper officer must ensure that timely action is taken on all applications for registration, including conducting physical verifications and addressing queries, to avoid granting registration on a deemed basis due to delays.
- In cases where registration is granted without conducting physical verification or under high-risk parameters, the details of such cases should be communicated to the jurisdictional Commissionerate for subsequent physical verification within 15 days of registration.
- The Principal Chief Commissioner/Chief Commissioner of CGST Zones should closely monitor the processing of registration applications, including physical verifications, within their zones and take remedial action if deemed approval has been granted, ensuring timely resolution.
This Article is only a knowledge-sharing initiative and is based on the Relevant Provisions as applicable and as per the information existing at the time of the preparation. In no event RMPS & Co. or the Author or any other persons be liable for any direct and indirect result from this Article or any inadvertent omission of the provisions, update etc. if any.
