Indian Medical Association under Investigation for major GST Evasion

The registration department issued an order directing the district registrar of Thiruvananthapuram to start an investigation into the Indian Medical Association. The investigation focuses on a central GST department report that the IMA engaged in widespread GST evasion.

The investigation will determine whether there are any discrepancies in the accounts and if registration rules were violated. The registration IG urged a thorough probe into this. The order requires a verification of the IMA Kerala chapter’s balance sheets and income-expenditure statements since registration. The income of IMA’s subsidiaries, including IMAGE (IMA Gone Eco-Friendly), PEPS (Professional Equipment and Employment Protection Scheme), and Periyar Guest House, will also be evaluated.

The Indian Medical Association (IMA) was registered under the 1955 Travancore – Cochin Literary, Scientific and Charitable Societies Registration Act. The registration IG’s preliminary investigation suggested that IMA subsidiaries such as IMAGE, PEPS, and Periyar Guest House are not registered. Despite being registered as a non-profit charitable organisation, the GST Intelligence discovered that the IMA engages in considerable commercial activities.

They also run a guest house, a bar, and an insurance scheme for members. However, they claim to be only a professional club and hence do not pay GST, as per a report. The central GST department filed a detailed affidavit against the IMA in the High Court. The directorate general of GST Intelligence stated in the report that 90% of IMA’s operations are not charitable. The report urged that the IMA be subject to GST rules. It further alleged that certain profit-making IMA businesses transferred funds to it for a variety of purposes, including the purchase of land and the holding of conferences.