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gst defaulting suppliers
Tax evasion via bogus firms; fake invoices or claiming fraudulent input tax credit has been rampant since the introduction of Goods and Services Tax (GST).Due to this, it is of utmost importance to verify the genuineness of the supplier & GST Verification.

The present article covers the steps through which the taxpayer can identify GST defaulters.

Verifying the genuineness of the supplier via details mentioned on the tax invoice-(GST Verification)

e-Invoicing
The preliminary investigation for the genuine or bogus supplier is to verify GST the details mentioned by the supplier on the tax invoice.

Notably, any tax invoice will be categorized as a fake invoice if it lacks any of the following 16 mandatory fields-

  • Name, address and GSTIN of the supplier;
  • Tax Invoice number;
  • Date of issue;
  • Name, address and GSTIN of the recipient (if available);
  • Shipping as well as billing address;
  • Place of supply;
  • HSN code or SAC code;
  • Items details like-
    • Description of goods/ services;
    • Quantity of the goods;
    • Unit (i.e. meters, kgs etc.);
    • Total value of the supply of goods/ services.
  • Taxable value of the supply of goods/ services;
  • Rates and amounts of GST (CGST, SGST or IGST);
  • Signature of the supplier.
  • Thus, if the tax invoice of the supplier doesn’t contain any of the basic details. Then, preliminary it can be concluded that the supplier is bogus.

    However, contradictory, if the tax invoice of the supplier contains all the basic details, it doesn’t mean the supplier is genuine.

    It can be concluded that the supplier has just cleared the preliminary investigation stage.

     GSTIN Verification of the supplier

    Once the preliminary investigation with regard to the tax invoice is done, the second GST verification should be of the GSTIN mentioned by the supplier.

    The basics of GSTIN and its verification are stated here under-

    • Goods and Services Tax Identification Number (GSTIN) is the 15 digits alphanumeric number issued at the time of GST registration.
    • The format of GSTIN (i.e. 15 digits alphanumeric number) consists of-

    Format of GSTIN

    Representation of the format

    First two digits of GSTIN

    It represents the state code

    Next ten digits of GSTIN (3rd to 12th digits)

    It indicates the 10 digits PAN of the registrant

    Next one digit of GSTIN (13th digit)

    It indicates the frequency of registration done by the business entity.

    Next one digit of GSTIN (14th digit)

    It is just a default alphabet ‘z’

    Last one digit of GSTIN (15th digit)

    It indicates the check code (it can be number or alphabet)

  • If the GSTIN of the supplier is not as per the format/ structure explained above, then, the taxpayer can easily accomplish the same as a fake invoice.
  • However, if the GSTIN of the supplier is correct, it doesn’t mean the GSTIN is valid nor it means that the GSTIN mentioned belongs to the supplier.
  • Thus, to verify the same, the taxpayer needs to carry out the below GST verification.
  •  Verification of the genuineness of the supplier via the GST portal

    GST portal facilitates the taxpayer to verify the genuineness of the supplier by enabling the taxpayer to search either on the basis of GSTIN/ UIN or PAN of the supplier.

    Steps to be followed to conduct such search is narrated hereunder-

    Facility to search by GSTIN/ UIN of the supplier

    GST Verification

    Cases, wherein, the GSTIN/ UIN of the supplier is available-

    • Step-1: Visit the GST portal i.e. https://www.gst.gov.in/.
    • Step-2: Click ‘Search Taxpayer’.
    • Step-3: Select ‘Search by GSTIN/ UIN’ from the drop-down list available under ‘Search Taxpayer’
    • Step-4: Enter the GSTIN/ UIN of the Taxpayer
    • Step-5: Type the character shown in the image
    • Step-6: Click ‘SEARCH’

    By following the above steps, the following details of the taxpayer/ supplier will be displayed-

  • Legal Name of Business,
  • Trade Name,
  • Effective Date of registration,
  • Constitution of Business,
  • GSTIN/ UIN Status,
  • Taxpayer Type,
  • Administrative office address,
  • Other office address,
  • Principal Place of Business,
  • Whether Aadhaar Authentication done by the supplier or not?
  • Whether e-KYC verification done by the supplier or not?
  • Nature of Core Business Activity,
  • Nature of Business Activities,
  • List of Goods and Services the supplier is dealing,
  • Additionally, by clicking ‘SHOW FILING TABLE’ the return filing details of the supplier in Form GSTR-3B will be displayed.
  • Facility to search by PAN of the supplier

    GST Verification Process
    However, in case the supplier is new and the GSTIN/ UIN of the supplier is not available. Still, the GST portal provides the facility to verify the authentication of the supplier based on the PAN of the supplier.

    Following steps are to be followed in order to search the supplier by PAN-

    • Step-1: Visit the GST portal i.e. https://www.gst.gov.in/.
    • Step-2: Click ‘Search Taxpayer’.
    • Step-3: Select ‘Search by PAN’ from the drop-down list available under ‘Search Taxpayer’
    • Step-4: Enter the Permanent Account Number (PAN) of the Taxpayer
    • Step-5: Type the character shown in the image
    • Step-6: Click ‘SEARCH’

    By following the above steps, the following details of the taxpayer/ supplier will be displayed-

    • GSTIN/ UIN,
    • Status of GSTIN/ UIN, and
    • State.

    Notably, additional details of the supplier will be available by clicking the ‘GSTIN/ UIN’.

    It should be noted that both the above search is possible on the home page of the GST portal (i.e., before login) and also after login in the GST portal.

    Synopsis-

    The following easy steps helps to verify the bogus and genuine supplier under GST-

    STEP-1 – Detailed verification of the tax invoice issued by the supplier;

    STEP-2 – Verification of format of GSTIN of the supplier; and

    STEP-3 – Verification of the GSTIN/ UIN or PAN of the supplier via search facility available on the GST portal.


    About the author

    Poonam Gandhi is a Chartered Accountant and a Lawyer. She is a Professional Freelance Content Writer/ Editor and an Educator.She masters in creating result-oriented as well as Search Engine Oriented Content. Currently, she is associated with some of the topmost leading sites of India.She holds more than 3 years of experience in the content field. Before entering the content writing field, she possessed a wide practice experience of more than 9 years, specifically, in the field of Indirect Taxation.

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