New Delhi, July 2 (KNN) The government warned businesses against generating fake invoices to evade Goods and Service Tax (GST) saying tax officers will take strict action in such cases.

Minister of State for Finance Anurag Thakur had said the risk of fake invoice needs to be checked to ensure that honest taxpayers do not suffer and the government does not lose revenues.

He said the government will take strict action against those involved in generating fake invoices. The government is "serious about curbing this menace.”

GST officers have booked 535 cases of fake invoices involving a total fraudulent claim of Rs 2,565 crore of input tax credit (ITC) and arrested 40 persons so far in the current financial year, said Finance Minister Nirmala Sitharaman.

Sitharaman said the government has taken various measures to prevent GST evasion. These include a specialized directorate within the Central Board of Indirect Taxes and Customs (CBIC) which is engaged in data analytics and risk management. It disseminates analytical reports and intelligence inputs to field formations of CBIC for the purpose of scrutiny, audit and enforcement to prevent GST evasion.

Thakur also urged GST officers to be sensitive to the concerns of honest taxpayers saying their interaction with trader moulds public opinion about GST.

Hoping that trade and industry will request their constituents to shun bad practices and comply with the law, Thakur said the policy of the government would be: "imandaar trader se bair nahi, fake invoices walon ki khair nahi" (no honest trader will be troubled but those generating fake invoices will not be spared).

In 2018-19, 1,620 cases of fake invoices were registered involving fraudulent ITC claim of ₹11,251 crore under the GST. As many as 154 persons were arrested.

The GST Council, chaired by Union finance minister and comprising state counterparts, last month decided to launch pilot project under which businesses above a specified threshold will have to generate e-invoice for B2B (business-to-business) sales from January 1.

GST, which subsumed 17 local taxes, was rolled out on July 1, 2017. It currently has four slabs -- 5, 12, 18 and 28 per cent. On top of the 28 per cent slab, a cess is levied on automobiles, luxury, demerit and sin goods

Jaitley, who in May wrote to Prime Minister Narendra Modi expressing his unwillingness to be a Minister in the Modi 2.0 government due to health reasons, said as many as 20 states are already showing more than a 14 per cent increase in their revenues and do not require the Centre to compensate them for revenue loss arising out of GST implementation.

Monthly GST collection data released by the finance ministry showed that revenue mop-up in June 2019 fell to ₹99,939 crore, down from over ₹1 lakh crore in the previous month. The collection was ₹95,610 crore in June 2018.

Thakur exuded confidence that the government will meet the Budget target of GST revenue mop-up.

"Even if there is any shortfall in a particular month's collection, we will achieve the budget target at the end of the fiscal. I can assure you that in the coming months, you will see increase in GST collections," Thakur said.

Speaking about improving compliance, Revenue Secretary Ajay Bhushan Pandey said the information technology system will ensure that the honest taxpayers are completely given a fair treatment.