Infy faces flak, as GST collection dives

Infy faces flak, as GST collection dives

With the Goods and Services Tax (GST) collection diving by 9.5% in October, it is Bengaluru-based IT major Infosys that is facing the wrath of traders and tax experts for technical glitches in the GST Network portal.

Although, the Finance Ministry  has attributed the drop to the reduction in tax rates and self-returns, traders and experts  have a completely different tale to tell.

"There are issues in the editing of GSTR 3B forms. In many of the cases, it is showing the reset error, and it is the problem caused by the technology vendor (Infosys)," a senior tax consultant from one of Big Four tax consultants told DH.

According to the consultant, many have not deposited their GST dues owing to this, as they had earlier erred in their GST summary return (3B). "It is also blocking input credit for many of the traders," the consultant said.

The Group of Ministers (GoM) set up to look into GSTN glitches had, in its last meeting with Infosys, asked the company to enable the editing option in the form. The issue had affected close to two lakh traders.

There have been cases where the names and details of traders and businesses have appeared wrongly on the portal.

The consultant also pointed towards the persistent drop in the number of filings, which he attributed to lack of penalty, along with the GSTN glitches. "We are seeing a significant drop in the filings from the SME sector, as they know that the government is going to waive their penalties," he said.

For October, only 52.7% of the taxpayers registered under the GST have filed the return till now. Out of 95.9 lakh registered taxpayers, only 50.1 lakh taxpayers have filed the returns. Although there are 15.1 lakh composition dealers among them, but the number of fillings has dropped continuously for the second month now.

The total number of GSTR 3B returns filed for the return period July, August, and September are 58.7 lakh, 58.9 lakh, 57.3 lakh respectively.

"I see a problem in the way the government has been dealing with Infosys on the issue. The deliverables from Infosys have not been clearly defined, thereby every amendment is treated like an emergency," according to Bengaluru-based tax consultant Mohan Lavi.

Although, Infosys denied any such issue, a senior tax official, on condition of anonymity, said that it is quite possible. "I would urge taxpayers to report such cases immediately," the official said.

According to Federation Of Karnataka Chamber Of Commerce and Industry (FKCCI), the IT major seems to have misled the government on the issue.

"They (Infosys) are responsible, as they informed the government that GST can be implemented, without portal readiness. The government is dependent on Infosys," Chairman-Internal Trade, Ramesh Lahoti, said.

As per the estimates, the collection for  October should have been at least Rs 96,000 crore, however, only Rs 83,346 crore have been collected till now.

A senior GSTN official recently hinted that the government might levy fine on Infosys, once dust settles. "Our priority is landing the plane right now, the rest will follow. Infosys is the pilot of the plane," the official said.

In fact GST officials are irked with the the way Infosys has been handling the issue, as per the sources in the know. Last week, the GoM, headed by Bihar Deputy Chief Minister Sushil Kumar Modi, escalated the issue to the level of Infosys Chairman Nandan Nilekani.

 

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