Identifying Fake GST Bills & Report It: The Complete Process Step By Step

The Goods and Services Tax (GST) system, introduced in India in 2017, aimed to simplify the indirect tax structure by replacing various taxes like VAT and service tax. However, as the GST network expands, there is a rise in fraudulent activities, including the issuance of fake GST invoices. To stop GST fraud, the GST department is continuously amending the rules of the system.

These invoices are sometimes used for settling claims and claiming Income Tax Credits. To prevent falling victim to fraud, customers should verify the authenticity of the GST bill. This quick check ensures that the bill received is genuine and helps in avoiding any fraudulent transactions.

What constitutes a GST invoice? 

A GST invoice is created by a supplier or seller for the buyer of goods and services. This document includes essential details such as the identification of the buyer and seller, product name, description, quantity of goods or services, supplier information, purchase date, discounts, and more.

What defines a counterfeit GST invoice? 

According to the Union Ministry of Finance, a fake GST bill is generated with a genuine supply of goods or services or payment of GST. Such invoices can be created for purposes like GST evasion, converting Income Tax credit into cash, recording fictitious purchases, and facilitating money laundering.

How to authenticate a GST invoice: To verify the authenticity of a GST bill, you can follow a few straightforward steps. Here's how you can confirm the legitimacy of a GST invoice.

1. Check the GSTIN: The primary step in authenticating a GST bill is to verify the supplier's GSTIN (Goods and Services Tax Identification Number). Every registered supplier of goods or services is assigned a unique 15-digit GSTIN, comprising the state code, PAN, and a distinct registration number.

To authenticate a GSTIN, follow these simple steps:

1. Visit the GST portal: Go to www.gst.gov.in and click on the 'Search Taxpayer' tab.

2. Enter GSTIN: Input the supplier's GSTIN in the search bar and click 'Search'. Valid GSTIN will display the supplier's name and address.

3. Check invoice details: Verify the uniqueness and consecutiveness of the invoice number. Ensure the invoice date falls within the prescribed timeline.

4. Verify invoice value and tax amount: Confirm the correct invoice value and calculated tax amount using the GST calculator on the portal.

5. Check HSN/SAC code: Ensure the GST bill mentions the accurate HSN (for goods) or SAC (for services) code. Cross-verify on the GST portal.

6. Verify supplier's signature: Confirm that the GST bill is signed by the supplier or their authorized representative and that the signature matches records with GST authorities.

7. Check tax payment status: Verify the supplier's tax payment status on the GST portal. If paid, it will be reflected in their GST return.

To raise a complaint against GST fraud:

- Visit the official portal: Go to the GST portal and click CBEC Mitra Helpdesk.

- Raise Web Ticket: Click on 'Raise Web Ticket'.

- Email complaint: Send an email to cbecmitra.helpdesk@icegate.gov.in. 

Also Read: Guide to the Duty Drawback Scheme under the GST Act 2017