There are 1,474 risky exporters, identified by the finance ministry, who have fraudulently claimed IGST refund worth Rs. 2,020 crore. As per media reports, these claims grabbed everyone’s attention owing to a programme for exporters’ risk management.
Surprisingly, out of these 1,474 untraceable exporters, 1,125 (that’s more than 76 per cent) are from Delhi.
Apart from many other product categories, these exporters are engaged in the export of apparels, leather garments and floor coverings.
As per Government officials, the fraudulent claims caught everyone’s attention during a verification exercise, which found the exporters untraceable, following which their refund claims have been blocked.
They also said that strong action will be taken against these exporters.
If an adverse report is generated post verification of the exporter or his suppliers, IGST refund will be suspended in all such cases.
In June 2019, a programme for exporters’ risk management was started by the Government, following assessment of fraudulent claims taking advantage of the fully automated IGST refund system.
Their general modus operandi is to pay IGST at the highest rate of 28 per cent to quickly encash the undue ITC claims.
It is being said that the few fake/risky exporters are lobbying with some associations, while genuine exporters are being harassed by asking to provide thousands of verification documents.
As per the official, two-stage verification requires only three or four documents.
