New Delhi: GST officers can now launch prosecution against offenders in cases where the amount of evasion or misuse of input tax credit is more than ₹ 5 crore, the Finance Ministry has said.
However, this monetary threshold will not be applicable in the case of habitual evaders or in cases where arrests have been made at the time of investigation.

"One of the important considerations for deciding whether prosecution should be launched is the availability of adequate evidence,” the GST investigation wing under the Finance Ministry said, while issuing instructions for launching prosecution.

Prosecution should normally be launched where the amount of tax evasion, or misuse of ITC, or fraudulently obtained refund is more than ₹ 5 crore, it said.

Launching of prosecution by taxmen means commencement of legal proceedings against the offender.

This limit will not apply and prosecution can be launched in the case of a company/taxpayer habitually involved in tax evasion or misusing Input Tax Credit (ITC) facility or fraudulently obtained refund.

"A company/taxpayer would be treated as habitual evader, if it has been involved in two or more cases of confirmed demand (at the first adjudication level or above) of tax evasion/fraudulent refund or misuse of ITC involving fraud, suppression of facts etc. in past two years such that the total tax evaded and/or total ITC misused and/or fraudulently obtained refund exceeds Five Hundred Lakh rupees.

"DIGIT database may be used to identify such habitual evaders," the CBIC said.
Source: NDTV
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