{"id":7278,"date":"2018-05-23T18:43:08","date_gmt":"2018-05-23T13:13:08","guid":{"rendered":"https:\/\/www.instamojo.com\/blog\/?p=7278"},"modified":"2021-05-23T02:06:13","modified_gmt":"2021-05-22T20:36:13","slug":"itc-fraud-gst-compliant-invoices","status":"publish","type":"post","link":"https:\/\/www.instamojo.com\/blog\/itc-fraud-gst-compliant-invoices\/","title":{"rendered":"Input Tax Credits Fraud: Why you need GST Compliant Invoices"},"content":{"rendered":"

The intelligence unit of GST, <\/span>The Directorate General of Goods and Services Tax Intelligence (DGGSTI)<\/span> has reportedly arrested a business that used fake invoices to claim Rs. 450 crore Input Tax Credits.<\/span>\u00a0The estimated value of these fake purchases was Rs 2,500.<\/span><\/p>\n

Input Tax Credit Frauds<\/h2>\n

The Financial Express<\/span><\/a> reported,\u00a0the business\u00a0acquired fake bills issued on transactions that never happened and then claimed ITC based on these invoices. <\/span><\/p>\n

There have been numerous reports of fake ITC claims.\u00a0 Two people in Mumbai were arrested for issuing fake GST invoices. The DGGSTI is estimating this fraud to go over Rs 300 crore.<\/span><\/p>\n

Understanding Input Tax Credits (ITC) <\/b><\/h2>\n

Input Tax Credit (ITC) <\/span><\/a><\/span>\u00a0\u00a0allows<\/span> t<\/span>he taxpayers to claim credit for the taxes paid on the purchase.\u00a0<\/span>ITC is important in the functioning of GST. It reduces the tax burden on the end customer and also helps the seller get back money eventually reducing the price of goods and services.\u00a0<\/span><\/p>\n

GST compliant invoices are a major requirement if you want to get Input Tax Credits. The GST Network computes ITC by checking purchase and sales invoices uploaded by businesses.<\/p>\n