DGGI directs to Block disputed Input Tax Credit against Fake Invoices, Invoices without Receipt of Goods or Services [Read Letter]

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The Directorate General of GST Intelligence ( DGGI ) has issued directions to all Zonal Chief Commissioners on Blocking of Input Tax Credit under rule 86A(1)(a) of CGST Rules.

Rule 86A. Conditions of use of amount available in electronic credit ledger.-

(1) The Commissioner or an officer authorised by him in this behalf, not below the rank of an Assistant Commissioner, has reasons to believe that credit of input tax available in the electronic credit ledger has been fraudulently availed or is ineligible in as much as

a) the credit of input tax has been availed on the strength of tax invoices or debit notes or any other document prescribed under rule 36-

b) issued by a registered person who has been found non-existent or not to be conducting any business from any place for which registration has been obtained; or

2) without receipts of goods or services or both.

The DGGI directed that, All the Zonal Chief Commissioners have the facility to block/unblock ITC availed in a situation covered under Rule 86A(1)(a) of the CGST Rules, 2017 against fake invoices or against invoices without receipt of goods or services or both if such availed of credit are located in their jurisdiction.

The Chief Commissioners of each zone should appoint an officer of the rank of Dy. Commissioner/A.C., as a nodal officer, assisted by a few more officers, who should undertake this activity.

In a Communication issued to all Principal Commissioners of the State Department, the DGGI also directed that, all over India, should also make a Cell in their zone head office nominating one AD/DD rank officer as nodal officer assisted by a few other officers to block the credit of such avails received from their zonal CGST Chief Commissioner, who are located outside the jurisdiction of the concerned CGST Zone.

To Read the full text of the Communication CLICK HERE