Sikkim Firms Face Scrutiny Over Excess GST Refunds
The budgetary support scheme was aimed at promoting industrial development in states such as Jammu & Kashmir, Himachal Pradesh, Uttarakhand, Sikkim, and other northeastern regions.
An investigation by the Siliguri CGST & CX Commissionerate has revealed that several companies operating in Sikkim have allegedly claimed excess refunds under the GST budgetary support scheme, amounting to over Rs.1,000 crore, with the estimated excess refund pegged at Rs.1,032 crore since the scheme's inception in 2017. The commissionerate found that some business units applied...
An investigation by the Siliguri CGST & CX Commissionerate has revealed that several companies operating in Sikkim have allegedly claimed excess refunds under the GST budgetary support scheme, amounting to over Rs.1,000 crore, with the estimated excess refund pegged at Rs.1,032 crore since the scheme's inception in 2017.
The commissionerate found that some business units applied for budgetary support at rates higher than those prescribed under the scheme and received refunds accordingly. Preliminary findings suggest that these claims were made by inflating the value addition figures beyond the notified limits, which led to substantial excess payouts under the scheme.
Launched in October 2017 following the nationwide implementation of GST, the budgetary support scheme was aimed at promoting industrial development in states such as Jammu & Kashmir, Himachal Pradesh, Uttarakhand, Sikkim, and other northeastern regions.
Complete GST Act & Rules with amendments made by financial bill, 2025 - CLICK HERE
The Cabinet Committee on Economic Affairs approved a financial outlay of ₹27,413 crore under the scheme, covering the period from July 2017 to March 2027. The scheme replaced the earlier central excise exemptions and was meant to reimburse eligible industrial units the central share of the CGST and IGST paid in cash.Around 4,284 units located across the designated states were expected to benefit from the scheme.
The support, however, was restricted to a notified percentage of value addition. The ongoing investigation revealed that several companies in Sikkim, including some large corporates, have been availing refunds based on inflated claims of value addition, which is not permissible under the scheme guidelines.
Sources in the department confirmed that during summon proceedings, a number of these companies admitted to applying for support at rates higher than those allowed. The probe is still underway, and the department is expected to take further action based on the findings.This was reported by The Telegraph Online.
Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates
