Taxmen allege GST fraud by Multinational Giants
Tax authorities have alleged GST non-compliance by several multinational companies.
As per reports in the Business Standard, the said companies which include big corporates Procter & Gamble, Johnson & Johnson and Samsung, are said to have not passed on benefits from the GST tax cut to customers. Officials allege that Procter and Gamble failed to pass on more than $35 million in tax benefits.
The National Anti-Profiteering Authority has reported that Procter & Gamble had not reduced prices on many products despite a tax-cuts. However, P&G, Samsung and J&J have denied any wrongdoing, and stated that they are committed to compliance.
|Background||The Law||Penalties for Non-Compliance|
| · The government had reduced GST to 18 % from 28 %, and to 5 % from 12 % on many products
· The government also exempted some goods that had earlier been taxed
|Companies were required to pass on GST benefits to customers, in the form of reduced prices|| · The report states that P&G has been issued a show-cause notice and is required to submit its reply on April 29 2019
· The final order is expected to be passed in the next 3 months
Corporate Governance: MCA Action against Directors & Promoters
Forensic audits of more than 200 companies facing insolvency resolutions under the Insolvency and Bankruptcy Code (IBC) have exposed major financial irregularities.
The offences include siphoning of funds for illegal transactions with related parties, including illegal involvement of banks, as per reports in the Times of India.
The Ministry of Corporate Affairs is expected to initiate action against the promoters, directors as well as auditors of the said companies.
A separate probe into the irregularities led by the Serious Frauds Investigation Office (SFIO) is parallelly underway.