GST Council to amend GST Registration rules to combat the threat of fake and fraudulent GST registrations

The 50th GST Council Meeting was held on July 11, 2023 in New Delhi under the chairpersonship of the Union Finance and Corporate Affairs Minister Smt. Nirmala Sitharaman.

Many important recommendations relating to changes in GST tax rates, measures for facilitation of trade and measures for streamlining compliances in GST were made.

The Council has suggested the following amendments to the CGST Rules, 2017 in order to tighten the registration process and effectively combat the threat of fake and fraudulent GST registrations.

The proposed amendments are as follows:

Amendment in Rule 10A:

This rule provide that bank account data, including the registered person’s name and PAN, must be provided within 30 days of registration or before filing a statement of outward supply in FORM GSTR-1/ IFF under Section 37 of the CGST Act, whichever comes first.

Amendment in rule 21A(2A):

The registration of registered people who fail to furnish appropriate bank account data as required by Rule 10A within the specified time period shall be suspended.

Insertion of 3rd proviso in rule 21A(4):

The amendment in this rule provide that for automatic revocation of such system-based suspension upon compliance with provisions of rule 10A.

Amendment in rule 59(6):

The amended rule said that if a registered person has not provided information of a legitimate bank account under rule 10A, the registered person may be barred from providing details of outward supplies in FORM GSTR-1 or through IFF.

Amendment in rule 9 and rule 25:

The necessity for physical verification of business premises in the applicant’s presence will be removed. Furthermore, even after Aadhaar authentication has been completed, physical verification may still be performed in high-risk circumstances.