Table of Contents

GST Number Verification in India: Online Process, Structure & Importance

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:

a. Visit the official GST portal.

b. Click on ‘Search Taxpayer’ and select either:

a. Search by GSTIN/UIN

b. Search by PAN

c. Enter the GSTIN or PAN of the supplier.

d. Click on the ‘Search’ button.

e. The portal will display the following details:

      o Legal name of the business

      o Trade name

      o Centre and state jurisdiction

      o Date of GST registration

      o Business constitution type (Proprietorship/Partnership/Company, etc.)

      o Type of taxpayer (Regular/Composition/Casual, etc.)

      o GSTIN status (Active/Cancelled)

      o Date of cancellation (if applicable)

      o Nature of business activity

      o 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.

frequently asked questions (faq's) related to GST Number Verification

Q What is a GSTIN (Goods and Services Tax Identification Number)?+

Q Why is GSTIN verification important?+

Q How can I verify a GSTIN?+

Q What are the different ways to verify a GSTIN on the GST portal?+

Q Can I verify a GSTIN offline?+

Q Are there any mobile apps for GSTIN verification?+

Q What information can I get by verifying a GSTIN?+

Q What does it mean if a GSTIN is inactive or cancelled?+

Q How often should I verify GSTINs?+

Q What should I do if I find a fake or invalid GSTIN?+

Q Can I verify multiple GSTINs at once?+

Q How do I find a GSTIN?+

Q What is the structure of a GSTIN?+

Q Can I verify a GSTIN without internet access?+

Q What is the purpose of the last digit in a GSTIN?+

Q How can I ensure that the GSTIN provided to me is genuine?+

Q What are the consequences of dealing with a business with a fake GSTIN?+

Q How can I report a fake GSTIN?+

Q Is it mandatory to mention the GSTIN on invoices?+

Q How can I verify the GSTIN of a foreign company?+

Q Where can I find the latest notifications and circulars related to GSTIN verification?+