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GST Number Verification

GST Number Verification

GST Number verification is the process in which any entity can verify the GST number of its suppliers, Vendors or customers. GST Number verification can be done based upon unique 10 digit PAN.

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Comprehensive Guide on GST Number Verification in India

1. Introduction to GST Number Verification

Goods and Services Tax (GST) is a unified indirect tax system implemented in India. Every registered taxpayer under GST is assigned a unique 15-digit alphanumeric GST Identification Number (GSTIN). Verifying GST numbers ensures the authenticity of business transactions and seamless input tax credit (ITC) claims.

2. Structure of GSTIN

The GSTIN format is designed to include essential details about the registered entity:

  • First two digits – Represent the state code as per the Indian Census 2011.
  • Next ten characters – Correspond to the Permanent Account Number (PAN) of the entity.
  • 13th digit – Indicates the entity number within the PAN (e.g., proprietorship, partnership, company, etc.).
  • 14th character – A default alphabet (typically ‘Z’).
  • 15th character – A check code used for error detection.

3. Importance of GST Number Verification

Verifying a GST number is crucial for various reasons:

  • Ensures the supplier’s GST registration is valid.
  • Helps claim proper ITC, avoiding fraud or non-compliant suppliers.
  • Prevents transactions with defaulters who have not filed returns or deposited tax.
  • Avoids penalties and legal complications due to incorrect GSTIN reporting.

4. How to Verify a GST Number Online

The GST Portal (https://www.gst.gov.in/) allows anyone to verify a GSTIN by following these steps:

  1. Visit the official GST portal.
  2. Click on ‘Search Taxpayer’ and select either:
    1. Search by GSTIN/UIN
    2. Search by PAN
  3. Enter the GSTIN or PAN of the supplier.
  4. Click on the ‘Search’ button.
  5. The portal will display the following details:
    • Legal name of the business
    • Trade name
    • Centre and state jurisdiction
    • Date of GST registration
    • Business constitution type (Proprietorship/Partnership/Company, etc.)
    • Type of taxpayer (Regular/Composition/Casual, etc.)
    • GSTIN status (Active/Cancelled)
    • Date of cancellation (if applicable)
    • Nature of business activity
    • GST return filing status

5. Benefits of GST Number Verification

5.1 Ensuring Authenticity

  • Helps verify the legitimacy of GST-registered businesses.
  • Prevents dealing with fraudulent vendors using fake GSTINs.

5.2 Avoiding ITC Mismatches

  • Ensures seamless input tax credit flow by validating supplier compliance.
  • Helps businesses avoid errors in GST return filings due to incorrect GSTIN entries.

5.3 Fraud Prevention

  • Prevents scams where suppliers provide invalid GST numbers to claim undue benefits.
  • Reduces tax evasion risks and ensures compliance.

5.4 Compliance Assurance

  • Businesses can monitor the return filing status of suppliers to ensure compliance.
  • Helps in timely rectification of discrepancies before filing GST returns.

6. Common Issues in GST Number Verification

  • Incorrect GSTIN entry: Manual errors while entering GST numbers can lead to incorrect verification results.
  • Cancelled GSTIN: Transactions with businesses whose GSTIN is cancelled may result in ITC denial.
  • Non-filing of Returns: If a supplier has not filed returns, ITC claims against their invoices may be denied.

7. Case Study: ITC Denial Due to Invalid GSTIN

Scenario: A manufacturing company, ABC Ltd., purchased raw materials worth INR 5,00,000 from XYZ Traders and claimed ITC. Later, during an audit, the GST authorities found that XYZ Traders’ GSTIN was canceled six months prior. As a result, ABC Ltd. faced an ITC denial of INR 90,000.

Key Takeaway: Regular GSTIN verification could have prevented this issue, ensuring valid ITC claims.

8. Conclusion

Verifying GST numbers is an essential compliance measure for businesses under GST. It ensures smooth ITC claims, prevents fraud, and promotes a transparent tax ecosystem. Businesses should regularly verify supplier GSTINs to avoid legal and financial complications.

For professional assistance, reach out to us on email: info@returnfilings.com or on whatsapp: https://wa.me/919910123091 to ensure all statutory obligations are met on time.

9. Additional Resources

For further reading, you may explore:

  • GST Annual Return Filing Guide – Understanding GST compliance for annual filings.
  • GST Input Tax Credit Rules & Compliance – Detailed analysis of ITC eligibility and restrictions.
  • GST E-Way Bill Requirements – Compliance and rules for goods transportation under GST.
  • GST Registration Process in India – Step-by-step guide to obtaining GST registration. 

Frequently Asked Questions on GST Number Verification

General Information about GSTIN

1.       What is a GSTIN (Goods and Services Tax Identification Number)?

A GSTIN is a unique 15-digit alphanumeric identifier assigned to every registered taxpayer under the Goods and Services Tax (GST) regime. It serves as a unique identification number for tracking financial transactions and is essential for all GST-related activities.  

2.       Why is GSTIN verification important?

GSTIN verification is crucial for: Confirming the registration status of a business. Ensuring that you are dealing with a genuine GST-registered entity. Checking the validity of the GSTIN provided by a supplier or customer. Avoiding fraudulent transactions. Claiming Input Tax Credit (ITC) correctly.  

Methods of GSTIN Verification

3.       How can I verify a GSTIN?

You can verify a GSTIN through the GST portal (www.gst.gov.in) or through other third-party platforms that use the GST portal’s data.  

4.       What are the different ways to verify a GSTIN on the GST portal?

You can verify a GSTIN on the GST portal by: Visiting the GST portal. Navigating to the “Search/Verify GSTIN/UIN” section. Entering the GSTIN you want to verify. The portal will display the details of the registered taxpayer, including their legal name, business address, registration status, and other relevant information.  

5.       Can I verify a GSTIN offline?

While the primary method is online, you can, in some cases, verify a GSTIN by contacting the GST helpdesk or visiting a GST office. However, the online method is the quickest and most reliable.  

6.       Are there any mobile apps for GSTIN verification?

Yes, there are mobile apps available that can be used for GSTIN verification. However, it is always recommended to verify through the official GST portal to ensure accuracy.  

Information Obtained through Verification

7.       What information can I get by verifying a GSTIN?

Verifying a GSTIN provides the following information: Legal name of the business. Trade name (if any). Address of the principal place of business. GSTIN status (active or inactive/cancelled). Date of registration. Type of taxpayer (regular, composition, etc.). Details of the taxpayer’s business activities. State jurisdiction.

8.       What does it mean if a GSTIN is inactive or cancelled?

If a GSTIN is inactive or cancelled, it means the business is no longer registered under GST. You should not conduct any GST-related transactions with such a business. Doing so could lead to issues with ITC claims and other compliance matters.  

Other Considerations

9.       How often should I verify GSTINs?

It’s a good practice to verify GSTINs before every major transaction, especially with new suppliers or customers. For regular transactions, periodic verification is recommended.

10.   What should I do if I find a fake or invalid GSTIN?

You should report it to the GST authorities.

11.   Can I verify multiple GSTINs at once?

The GST portal’s primary function is to verify one GSTIN at a time. However, some third-party tools might offer bulk verification features. Exercise caution when using such tools and double-check with the official GST portal.

Other generally asked questions related to GSTIN verification

12.   How do I find a GSTIN?

You can ask the business for their GSTIN or check it on their invoices.  

13.   What is the structure of a GSTIN?

The GSTIN is a 15-digit alphanumeric code with a specific structure defined by the GST law.  

14.   Can I verify a GSTIN without internet access?

Primarily, you need internet access to verify a GSTIN via the GST portal.  

15.   What is the purpose of the last digit in a GSTIN?

The last digit is a check digit used to detect errors in the GSTIN.  

16.   How can I ensure that the GSTIN provided to me is genuine?

Always verify the GSTIN on the GST portal.

17.   What are the consequences of dealing with a business with a fake GSTIN?

You may face issues with ITC claims and other legal complications.  

18.   How can I report a fake GSTIN?

You can report it to the GST authorities through the GST portal or by contacting the helpdesk.  

19.   Is it mandatory to mention the GSTIN on invoices?

Yes, it is mandatory to mention the GSTIN on invoices.  

20.   How can I verify the GSTIN of a foreign company?

Foreign companies supplying to India might have a GSTIN if they are registered. You can verify it like any other GSTIN.

21.   Where can I find the latest notifications and circulars related to GSTIN verification?

The GST portal is the official source for notifications and circulars.