Officials selling traders’ data to rivals for monetary gains, alleges CAs body
Details uploaded by traders while filing their returns under the Goods and Services Tax (GST)—about their purchases and sales—are being traded. Information such as from whom and at what price a trader purchased goods, and to whom and at what price they sold them, is allegedly being sold by state GST officers to rival traders.
A rival trader, after acquiring this data, can undercut prices and snatch away the entire business, potentially driving the original trader out of the market.
A letter raising this concern has been sent to the Gujarat government by a Chartered Accountants’ Association, also urging intervention by the central government. The letter warns that if this malpractice isn’t curbed, the entire GST system—intended to unify the country under one tax—could collapse.
As per the CA association, “Information such as from whom and at what price a trader purchased goods, and to whom and at what price they sold them, is allegedly being sold by state GST officers to rival traders.”
Usually, traders take precautions to ensure that their business data doesn’t reach competitors. However, GST officers themselves are creating a breach in this wall of protection by selling private trade data of GST-registered traders, essentially creating a separate black market for such information.
This scandal highlights the loopholes in the Government of India’s GST system. As per reports, confidential business data is being actively traded. GST return data like GSTR-1 is reportedly being sold for ₹8,000–₹10,000 for 3 months. GSTR-1 contains details of the value of goods/services sold and the tax liability incurred.
Likewise, data from GSTR-2B and GSTR-3B is also being sold. GSTR-3B details submitted to the department are allegedly being sold to rival traders for ₹15,000 for 3 months. These buyers are using the data to destroy their competitors’ businesses.
Misuse of Section 130 by GST babus
Traders are also facing harassment at check posts, where trucks carrying goods are being stopped and penalised under Section 129 of the GST Act. Penalties are imposed to the tune of 200% of the tax amount mentioned in the invoice. Traders are unable to claim Input Tax Credit (ITC) on this amount.
Instead of Section 129, officers are applying Section 130, under which they demand ₹54,000 against a ₹18,000 tax liability, and even ask for ₹1 lakh, equivalent to the goods’ value. This misuse indicates strong-arm tactics and abuse of power. Despite appeals under Section 170, attachments made under Section 83 are not being removed, even after a year, when the law no longer supports them.
Traders accused top brass officials of colluding and undermining their businesses from within.
There are also serious allegations of corruption in the manual refund process under GST. Officers are said to be manipulating refunds and imposing unreasonably harsh penalties in minor cases, putting traders in distress.