The CBIC has asked field offices to carry out physical verification of premises of businesses which have been granted deemed GST registration between August 21 and November 16 to ascertain that they have genuine business or intend to carry out so.

The Central Board of Indirect Taxes and Customs (CBIC) has also asked taxmen not to grant GST registration on deemed basis in cases where the applicant has not opted for Aadhaar authentication or the authentication has failed.

Current provision under Goods and Services Tax (GST) law allows for deemed registration upon completion of 21 days of application if the proper officer has not issued any notice within the said 21 days.

The CBIC, in its instruction to field offices, said that data suggests that during the period from August 21, 2020 to November 16, 2020 deemed registrations have been granted in many cases where Aadhaar authentication has not been opted for or has failed.

“These registrations granted on deemed basis require verifications to ascertain that they have genuine business or intends to carry out so,” the CBIC said while issuing Standard Operating Procedure (SOP) for carrying out physical verification of persons who have been granted deemed registration.

During the physical verification, the officer, among other things, would verify that in case the applicant intends to carry out manufacturing activity, the capital goods, if required for the said manufacturing activity, have been installed.The officer would also verify electricity connection, bills paid in the relevant period, size of the premises – whether it is commensurate with the activity to be carried out by the applicant, whether premises is self-owned or is rented and documents relating to ownership/registered lease of the said property.