Biometric-based Aadhaar authentication may be mandatory to check GST frauds

The GST Council might take up a proposal to make biometric-based Aadhaar authentication mandatory pan-India for suspicious persons seeking GST registration, CBIC chief Sanjay Kumar Agarwal said on Friday.

Currently, two States – Gujarat and Andhra Pradesh – and the Union Territory of Puducherry have launched Aadhaar authentication of taxpayers on a pilot basis.

“That is giving encouraging results. The number of (registration) applications has come down in Gujarat. That is an indication that with these measures, the people who were using others’ identities to create fake input tax credit (ITC) firms are now in check.

“Going by the encouraging results, it seems now more and more States will opt for it or it can be made uniformly applicable to all the States because ultimately it is the revenue which is impacted by fake registrations,” Mr Agarwal told the PTI in an interview.

Goods and Services Tax (GST) authorities have so far been using OTP-based Aadhaar authentication to establish the identity of the applicants seeking registration.

However, with instances coming to light wherein other people’s identity was misused to create bogus firms for claiming ITC, the CBIC had decided to move towards biometric authentication under which in certain suspicious cases, the person seeking registration would be asked to go to an Aadhaar centre to have his biometrics verified. “The call (on all States launching Aadhaar-based authentication) has to be taken by the GST Council. Currently, no such proposal has gone to the Council, but in future, there may be a proposal to GST Council to take a view on it,” Mr Agarwal said.

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