DGGI Issues Rs 184 Crore GST ITC Notice to Samsung Display Noida

The Directorate General of GST Intelligence (DGGI) Of Amritsar Unit has issued a show cause notice to M/s Samsung Display Noida Private Limited of Rs 184 crore, accusing the company of being in connection with wrongful Input Tax Credit (ITC) under the Central Goods and Services Tax Act, 2017.

After the long investigation of 1 year, DGGI sent the notice on 12 May and accused the company of wrongly claiming Input Tax Credit (ITC) on construction and contract-related expenses. Under GST law, ITC is usually not allowed on building construction expenses unless they are related to plant and machinery.

An official said that during the checking of GST records, it was found that two Samsung construction companies named M/s Samsung C&T India Private Limited and M/s Samsung E&A India Private Limited passed Input Tax Credit (ITC) to Samsung Display Noida Pvt Ltd, which was blocked.

The invoices were mainly related to building and construction work, including civil work, electrical work, plumbing, HVAC systems, fire safety systems, landscaping, and waste-water treatment facilities.

During the investigation, officers of DGGI also recorded statements of various company officials, including taxation managers, the chief financial officer and former finance officials.

The investigation further found that the company allegedly claimed and used around Rs 184 crore of Input Tax Credit (ITC) received from the two Samsung construction companies.

A show-cause notice under Section 74 of the CGST Act, 2017, has been issued, seeking recovery of the wrongly claimed ITC along with interest and penalty.

The officials also claimed that “During the investigation, M/s Samsung Display Noida Private Limited deposited an amount of Rs 18.5 crore and has also filed an appeal with appellate authorities.”