GST dept detains two chartered accountants for fraud, some other CAs call it 'malicious move'

The Goods and Services Tax (GST) Department has detained two chartered accountants in a GST fraud case. The CAs were detained by the Directorate General of GST Intelligence (DGGI), Gurgaon CGST Department, for issuing a certificate in a GST refund matter.

But a group of CAs has called for a protest, calling the detention "malicious". As per a video posted by the group of CAs, the arrest is "illegal and malicious" as no action is being taken against the person who had received the refund and the officer who allowed the refund without verifying documents.

"We had a council meeting on Friday where we deliberated on this. You cannot label a person guilty without giving them the opportunity of being heard. The frauds are not done by CAs but by the management. We have a zero-tolerance policy against negligence and misconduct," said Debashis Mitra, president of the Institute of Chartered Accountants of India (ICAI).

As per GST laws, for refund claims exceeding Rs 2 lakhs, a certificate from a chartered accountant or cost accountant must be given with the refund application.

Discussing the law, CA Umesh Sharma, vice-chairman of the GST Committee of ICAI, said, "Section 132 talks about punishable offences under GST law. And says, 'whoever commits, or causes to commit and retain the benefits arising out of, any of the following offences'. In this case, CAs are not getting unjust enrichment by issuing a certificate."

The group is awaiting a response from the GST council on the provision under which these CAs were detained and the course of action in this case.