Are you aware about fake GST invoices in restaurants? We always love to eat our favorite foods in restaurants and khau galli’s. Are we aware of GST payment on restaurant bills? Are restaurant moping you with false GST? Here we are trying to provide you with some useful insights relating to GST on restaurants.
Jagdish Lade, Pune based chartered accountant, has found the local restaurant charging GST without getting registered under GST Act. So Jagdish refused to pay the money which had been charged as GST in his bill, informing that restaurant is not registered under GST Act. They are not allowed to collect the tax without getting GSTIN. Finally the restaurant returned the money to Jagdish.
Tips to identify fake GST invoices in Restaurants
1) How to identify register or unregistered dealer?
- Register dealer should print GST number on their bill.
2) How to identify if they have printed Fake GST number?
- You can verify GST number in this link: https://services.gst.gov.in/services/searchtp
3) What are the GST rates to restaurants?
- Non-AC/non-alcohol serving hotels, it is 12%
- AC/alcohol-serving hotels, it is 18%
- Food made from Takeaway counter, it is 18%
- Alcohol served in restaurant, NO GST will be applicable on alcohol. VAT will be levied on alcohol items as per rates specified of that particular state.
4) Is ‘Service Charge’ mandatory in restaurants?
- Service Charge is not a tax. It is totally voluntary and not mandatory in restaurant bills.
- As per govt. guidelines, you can refuse to pay the ‘service charge’ that restaurants put on your bill if you are unhappy with the service.
- If a restaurant insists on customers paying the service charge, you can file a complaint in the consumer court.
5) Where should register complaint of GST Fraud?
a) Register your complaint on http://consumerhelpline.gov.in/ ;or
b) Call 1800114000 or 14404 or SMS on 8130009809
c) Email – firstname.lastname@example.org , email@example.com
d) GST portal – firstname.lastname@example.org , 0120-4888999, 011-23370115
e) Twitter handles- @jagograhakjago @consaff @askGST_Goi , @FinMinIndia
6) What is CGST and SGST rates in invoices?
- CGST means Central Goods & Service Tax and seller needs to deposit tax amount to Central Government.
- SGST means State Goods & service tax and seller need to deposit tax amount to State Government.
- Generally total component of GST amount is divided into CGST & SGST equally.
7) What will be the penalty to dealer in issue of false or fake GST invoices?
(a) Penalty under GST Act:
- In case of No intention of Fraud: Fine 10% of tax amount subject to minimum Rs. 10,000.
- In case of Fraud: Dealer may face penalties, prosecution and arrest. Fine 100% on tax amount subject to minimum Rs. 10,000 and
- Imprisonment up to 5 years depending on tax amount involved.
(b) Other Action:
- Consumers can file a complaint against the dealer in consumer court too.
Summary of above 7 tips
- Always check your bill and know what you are paying for
- If GST Number not printed on invoice – Don’t Pay GST amount mentioned in invoice.
- If WRONG GST Number printed on invoice – Take explanation from owner whether its wrongly printed and take correct GST printed bill. Then only pay GST amount mentioned in invoice. Otherwise Don’t Pay GST amount.
- If CORRECT GST Number in invoice – Pay GST amount
In conclusion, as a responsible citizen we should have knowledge about our role in our country, communities, and our world. Many of us don’t know we are paying taxes to government through business dealers (restaurants, medical, supermarkets, online eCommerce sites etc) and businesses can evade taxes (unreported tax/non-payment to govt) that you paid to them. Therefore, we should aware about TO WHOM & WHY you are paying taxes.
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GST awareness Facebook Post of Mr. Jagdish Lade on 18th August 2017. The post gone viral with 35,000 likes and 1,32,000 shares.