GST Registration After Physical Verification of Business Place if Aadhaar Not Authenticated: CBIC

Businesses registering under GST can opt for Aadhaar authentication, in absence of which registration would be granted only after physical verification of the place of business. In a notification, the Central Board of Indirect Taxes and Customs (CBIC) said when an applicant for GST registration opts for authentication of Aadhaar number, he shall, with effect from Friday (August 21), undertake the said authentication while submitting an application.

"Where a person… fails to undergo authentication of Aadhaar number or does not opt for authentication of Aadhaar number, the registration shall be granted only after physical verification of the place of business in the presence of the said person," the notification added. PwC India Partner National Leader (Indirect Tax) Pratik Jain said a taxpayer registering under GST can opt for Aadhaar authentication, in which case registration is deemed to be granted within 3 days without physical inspection of the premises. He added that in other cases, the time period could be up to 21 days and authorities can undertake physical verification of place of business or detailed review of documents as necessary.

"With linkage of Aadhaar with GST and PAN (permanent account number), there would be a centralised data base available with the government which will facilitate data analytics and help in checking tax evasion," Jain said. AMRG & Associates Senior Partner Rajat Mohan said authentication of Aadhaar number would be a norm for GST registration in absence of which registration would be granted only after physical verification of the place of business.

"Rigorous pre-registration verifications procedures would help arrest the rampant tax evasion by way of limiting the number of new fake entities," Mohan added. EY Tax Partner Abhishek Jain said this would provide "alternate options for revenue authorities to verify GST registration applications during the pandemic, specifically for scenarios where a mandatory physical verification of the premises was difficult in the current times".