The Goods and Services Tax (GST) law, which is about to mark its ninth year, has turned into a problem that becomes increasingly complicated as one tries to resolve it, affecting both common traders and tax practitioners. This is an undeniable reality.
Invoice Management System (IMS)
- The newly introduced Invoice Management System (IMS) serves as an example.
Before filing GST Return GSTR 3B, the trader must log in to the Invoice Management System on the GST portal. The trader must verify each tax invoice included in GSTR 1, ensuring the correctness of the information. The invoices will be marked with options such as “Accept,” “Reject,” or “Pending,” and the trader needs to tick the relevant box according to their understanding.
If the trader fails to tick these boxes, the details entered by the selling trader in GSTR 1 will be assumed to be accepted by the buying trader. The last date for filing GSTR 3B for the previous month is the 20th of the current month. However, the data from the selling trader will only appear in the IMS system around the 14th or 15th of the month. This gives the trader just a few days to verify all the tax invoices and tick them accordingly. If there’s any mistake, there is no way to correct it.
After logging into IMS, the information will be uploaded to GSTR 3B. If any discrepancies are found during the review, the trader must log back into IMS, correct the errors, and upload the updated information to GSTR 3B before proceeding with the filing of the return.
The details that appear automatically in IMS from GSTR 1 filed by the selling trader are not guaranteed to be completely correct, and there may be various mistakes or incomplete information. Furthermore, credit notes issued by the selling trader or corrections to GSTR 1 filed under GSTR 1A may not upload correctly or might fail to upload entirely. In such cases, the purchasing trader will be responsible for the issues caused. This could also lead to the denial of input tax credit (ITC).
- E-Invoices and E-Way Bills
Traders with an annual turnover of over ₹5 crore must compulsorily issue e-invoices for their B2B transactions. Additionally, all tax invoices with values exceeding ₹50,000 must have an e-way bill.
When all the transaction details are included in the e-invoice, an e-way bill will also be generated. The necessary details requested for the e-way bill must be provided correctly to ensure its accuracy.
- No Opportunity to Correct Errors in Returns
Various details required to be included in GST returns are numerous and must be filed without any errors. While errors are natural, the GST system expects taxpayers to avoid mistakes when submitting returns. However, the Supreme Court’s ruling on March 28, 2025, may open the doors for correcting human errors, which will likely lead to the GST authorities becoming more lenient.
- SMS Alerts
The GST portal has not yet implemented SMS alerts to remind taxpayers about the return filing deadlines. Taxpayers do not receive any notifications regarding notices, orders, or updates uploaded to their portal, which often leads to missed deadlines and penalties. A significant portion of GST-related penalties and interest charges are due to the taxpayer failing to notice the notices uploaded by the authorities.
- Appellate Tribunal
Eight years since the GST law came into effect, the lack of an Appellate Tribunal for taxpayers to challenge orders passed by the authorities denies them the opportunity for normal justice. In such cases, taxpayers are forced to approach the High Courts in search of justice, which leads to delays, mental stress, and financial strain.
- Changes in Rules, Forms, and Procedures
Since the GST law was implemented on July 1, 2017, over 2,000 notifications, circulars, orders, and updates have been issued concerning changes in the law, rules, forms, and procedural matters. These frequent updates make it difficult for taxpayers to keep up with the regulations, leading to non-compliance, penalties, and interest charges.
The difficulties faced by traders who have registered for GST are numerous, and only a fraction of these issues are covered in this article.
For resolving practical issues faced by GST taxpayers, the authorities must take swift action, as it is the responsibility of a democratic government to ensure the smooth functioning of GST. Only then can GST truly be considered a “Good and Simple Tax.”
P. Venkittaraman Iyer
State President
Confederation of All India Traders (CAIT)
