CBIC asks CGST zones to take illegal-mining data from State Mining Departments and examine it for GST evasion

What the audit observed

The draft Performance Audit Report of the Comptroller and Auditor General on “Assessment, Levy and Collection of GST on Minerals” observed that State Mining Authorities detect illegal mining, illegal transportation, seizure of minerals and vehicles, cancellation or suspension of leases, and excess extraction. There is at present no structured mechanism for sharing this with CGST field formations.

The Board notes that such information may indicate suppression of taxable supplies, non-registration, undervaluation, non-payment or short payment of tax, or wrongful availment of input tax credit.

What the zones have to do

1. Designate a Nodal Officer in each CGST Zone for coordination with the State Mining Department.
2. Set up a mechanism for periodic sharing of information on illegal mining and transportation of minerals detected in the jurisdiction.
3. Analyse the information for GST implications and initiate action wherever warranted under the CGST Act, 2017.
4. Disseminate the intelligence to the jurisdictional Commissionerates and DGGI formations.
5. Hold periodic meetings with the State Mining Authorities to review the mechanism.

What it means for the mining trade

A case booked by the mining department — a seizure, an excess-extraction finding, a suspended lease — can now reach the GST officer as a matter of routine. The instruction is addressed to the department; it does not change any rate or return.