Government identifies 5,106 ‘risky exporters’ who have fraudulently claimed GST refunds

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New Delhi, Jun 20: The government Thursday said it has identified 5,106 “risky exporters” so far who have claimed GST refunds based on bogus invoices, and would manually check their claims before issuing refunds. According to reports, such fraudulent claims of Integrated GST (IGST) refunds by exporters could exceed Rs 1,000 crore.

It cleared the air on new IGST refund process saying that the introduction of manual checks in IGST refunds is only aimed at preventing unscrupulous exporters from defrauding the exchequer.

The Central Board of Indirect Taxes and Customs (CBIC) said it would assure all genuine exporters that they would continue to get their IGST refunds in a timely manner in a fully automated environment.

The CBIC issued a statement refuting news reports that highlighted a perceived set-back to the automated process of refunds for exporters under GST after the introduction of manual checks to curb large scale frauds in IGST refunds.

The CBIC said it has recently instructed its Customs and GST formations to verify the correct availment of ITC by few exporters who are perceived as “risky” on the basis of pre-defined risk parameters.

‘Only 5,106 risky exporters have been identified so far as against about 1.42 lakh total exporters. Thus the risky exporters are only 3.5 per cent of the total exporters. Further, in the last two days — 17.06.2019 and 18.06.2019 only 1,436 Shipping Bills filed by total 925 exporters have been interdicted,’ it said.

Considering that about 20,000 Shipping Bills are filed by roughly 9,000 exporters on a daily basis, the intervention is negligible. Even for these risky exporters, the exports are allowed immediately. However, the refund would be released after verification of ITC within a maximum of 30 days, the CBIC said.

The new verification exercise is aimed at preventing unscrupulous exporters from defrauding the exchequer and bringing a bad name to the larger exporting community.

The CBIC said it would like to assure all genuine exporters that they would continue to get their IGST refunds in a timely manner in a fully automated environment.

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