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De-criminalisation & Circular Trading May Concern in Upcoming GST Meeting

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Arpit Kulshrestha

GST council could take the problem of circular trading in its forthcoming meeting. The council would be anticipated to discuss the report on the decriminalization of crimes beneath the GST statute.

Circular trading directed to bogus claims of ITC via traders through providing the invoices with no carrying of the real goods or services.

Bombay High court has furnished the show cause notice to the Maharashtra GST council towards arresting the individual for said circular trading.

Experts consider no requirement to furnish clarity on the problem of arrests in the concern of circular trading, “The CBIC has already issued a circular that circular trading is not a case of tax evasion and so arrests should not be made. However, detention in these cases continues,”

The GST Council, headed by Finance Minister Nirmala Sitharaman shall meet through video conferencing dated 17th December. Moreover, GST officials would anticipate acknowledging asking for the limit to launch the prosecution to Rs 20 cr from the present Rs 5 cr limit. Less than the same provided limit the property of the offenders would not get attached. The experts consider that the same can harasses the assesses.

Tax experts mentioned that the arrest provisions would not be incorporated towards the tax evasions until there would be an element of collusion, fraud, or a scheme planned to evade the tax.

Read Also: 48th GST Council Meeting to Discuss IDS, IGST & Transitional Credit

“However, the power to arrest exists even for tax evasions not involving such activities. This has sometimes been used as a tool to force assesses to pay tax at the investigation stage itself, even in issues involving interpretation of the law,” he articulated.

GST officials might suggest summing up some safeguards or revising the statute for making an effective balance for the taxpayer and the taxman.

Disclaimer:- “All the information given is from credible and authentic resources and has been published after moderation. Any change in detail or information other than fact must be considered a human error. The blog we write is to provide updated information. You can raise any query on matters related to blog content. Also, note that we don’t provide any type of consultancy so we are sorry for being unable to reply to consultancy queries. Also, we do mention that our replies are solely on a practical basis and we advise you to cross verify with professional authorities for a fact check.”


Published by Arpit Kulshrestha

Arpit Kulshrestha seeks higher interests in financial services, taxation, GST, I-T, etc. Writes articles with depth knowledge and is extensive for the same. The resources provide effective articles for the products of SAG infotech which provides taxation and IT software. Writing from observations and researching makes his articles virtuous.
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