Those filing fake invoices can't scoot easily as Budget empowers taxman to attach properties

Finance minister Nirmala Sitharaman, while presenting the Budget, was well aware of the impact on revenue collection from those who were indulging in the practice of filing fake invoices to claim input tax credit fraudulently.

The Budget for 2020-21 empowers the tax authorities to attach the properties of those who use fake invoices to evade tax.

"In order to protect the revenue, it is proposed to provide that the penalty proceedings initiated for fake invoice/sham transactions of more than Rs 2 crore shall also be eligible for provisional attachment of assets," the Finance Bill reads.


Last year's Budget penalised taxpayers who fudged their books and claimed input tax credit fraudulently.

The taxpayers who manipulated their books had to pay an amount equal to the false entry/omission made in their books as penalty.

Fake invoices have caused a shortfall in government's revenue collection.

GST for December and January showed record collections on the back of economic recovery and a crack down on evaders.

GST authorities have cracked down on those filing fake invoices to claim GST input tax credit.