Goods and Services Tax Network (GSTN) is a Section 8 (under new companies Act, not for profit companies are governed under section 8), non-Government, private limited company. It was incorporated on March 28, 2013.
The Government of India holds 24.5% equity in GSTN and all States of the Indian Union, including NCT of Delhi and Puducherry, and the Empowered Committee of State Finance Ministers (EC), together hold another 24.5%. Balance 51% equity is with non-Government financial institutions.
The Company has been set up primarily to provide IT infrastructure and services to the Central and State Governments, tax payers and other stakeholders for implementation of the Goods and Services Tax (GST). The Authorised Capital of the company is Rs. 10,00,00,000 (Rupees ten crore only).
However, recently The Union Cabinet has cleared a proposal to convert the GST Network into a Government-owned company, Finance Minister Arun Jaitley said.
“A few months ago, an in-principle decision was taken to make it a 100% government-owned entity… The GST Council has already approved this… The cabinet has approved it,” Jaitley said Wednesday after a cabinet meeting chaired by Prime Minister Narendra Modi.
The minister said the Centre will own a 50% stake in the GST Network and the remainder will be held by the states on a pro-rata basis in the new structure.
Genesis and Structure of GSTN
The GST System Project is a unique and complex IT initiative. It is unique as it seeks, for the first time to establish a uniform interface for the tax payer and a common and shared IT infrastructure between the Centre and States. Currently, the Centre and State indirect tax administrations work under different laws, regulations, procedures and formats and consequently the IT systems work as independent sites.
Integrating them for GST implementation would be complex since it would involve integrating the entire indirect tax ecosystem so as to bring all the tax administrations (Centre, State and Union Territories) to the same level of IT maturity with uniform formats and interfaces for taxpayers and other external stakeholders.
Besides, GST being a destination based tax, the Inter- state trade of goods and services (IGST) would need a robust settlement mechanism amongst the States and the Centre.
This is possible only when there is a strong IT Infrastructure and Service back bone which enables capture, processing and exchange of information amongst the stakeholders (including tax payers, States and Central Governments, Accounting Offices, Banks and RBI).
This aspect was discussed in the 4th meeting of 2010 of the Empowered Committee of State Finance Ministers (EC) held on 21/7/2010. In the said meeting the EC approved creation of an Empowered Group on IT Infrastructure for GST (EG) under the Chairmanship of Dr Nandan Nilekani along with five state commissioners of Trade Taxes. Department of Revenue, Ministry of Finance, Government of India vide OM no. S.34011/19/2010-SO (ST) dated 26th July 2010 notified the Empowered Group on IT Infrastructure for GST with following members:
–> Additional Secretary (Revenue), DoR
–> DG (Systems), CBIC as Member-Secretary
–> Financial Adviser, Ministry of Finance,
–> Member Secretary, Empowered Group of State Finance Ministers,
–> Member Technology Advisory Group for Unique Projects (TAGUP)
–> State GST Commissioners of Maharashtra, Assam, Karnataka, West Bengal and Gujarat.
Relationship of GSTN with Tax Administrations
The common GST Portal developed by GSTN will function as the front-end of the overall GST IT eco-system. The IT systems of CBIC and State Tax Departments will function as back-ends that would handle tax administration functions such as registration approval, assessment, audit, adjudication etc. Nine States and CBIC are developing their backend systems themselves.
GSTN is doing the backend for 20 States and 5 UTs. GSTN has been interacting with CBIC and States for ensuring mutual interaction between the front-end that would be operated by GSTN and the back-ends of the tax administrations. Till September 2016, ten workshops have been conducted with the States/CBIC.
GSTN will undertake training of tax officials in GST IT system from December 2016 onwards. During the operation phase as well GSTN will continue the interaction with CBIC and states and extend help wherever necessary.
Funding of GSTN
As mentioned above, the Central Government while approving creation of GSTN also approved a non-recurring grant of Rs 315 Crores. The table below shows the funds released by the Central Government since inception of GSTN and the funds actually utilised by the Company:
Year : Funds released by GoI : Actual Expenditure by GSTN
2013-14 : 3,03,65,612 : 3,03,65,612
2014-15 : 20,00,00,000 : 13,80,31,415
2015-16 : 120,93,00,000 : 45,27,97,027
Total : 143,96,65,612 : 62,11,94,054
Key People in GSTN are :
–> Dr. A B Pandey IAS – Chairman,
–> Prakash Kumar IAS – CEO,
–> Kajal Singh IRS – EVP, Services,
–> Vashishtha Choudhary IRS – SVP, GST Portal,
–> Rajeev Agarwal IRS – SVP, Outreach & Capability Builiding,
–> Nitin Mishra – EVP, Technology,
–> Dr. Abhishek Gupta IA&AS – EVP, Support,
–> Pramod Somanthe – SVP, Procurement & Contracts,
–> Anand Pande – SVP, CISO,
–> Prabin Dokania – SVP, Finance / CFO,
–> Nirmal Kumar – SVP, Software Developement,
–> Col. Pankaj Dikshit – SVP, IT Infrastructure,
–> Pankaj Sharma – VP, Company Secretary & CC,
At present Posts of Value add Services SVP & Tax Payer Profiling SVP are vacant
(SVP – Senior Vice President and EVP – Executive Vice President)
Board of Directors
I. Dr Ajay Bhushan Pandey, Chairman, GSTN
II. Shri Prakash Kumar, CEO, GSTN
III. Shri G. C. Murmu, Special Secretary (Revenue), Department of Revenue, Ministry of Finance,
IV. Smt. Meera Swarup, JS & FA, Department of Revenue, Ministry of Finance,
V. Shri S K Panda, Special Secretary & Member (IT), CBIC,
VI. Dr. Rajeev Ranjan, Special Secretary, GST Council Secretariat,
VII. Shri Arvind Agrawal, Additional Chief Secretary, Finance Department, Government of Gujarat,
VIII. Shri R. Chandrashekhar, President, NASSCOM
IX. Shri Anand Sinha, Retired Deputy Governor, RBI
X. Shri Nitin K. Jage, General Manager (Taxation) & Company Secretary, LIC Housing Finance Ltd.
XI. Shri Bhavesh C. Zaveri, Country Head, HDFC Bank Ltd,
XII. Shri Ajay Kumar Gupta, Senior General Manger, ICICI Bank Ltd.
Chairman, GSTN :
Dr. Ajay Bhushan Pandey is an officer of Indian Administrative Service having over 33 years of experience at various positions in Government of India.
Dr. Pandey is a graduate of Electrical Engineering from IIT Kanpur. In 1998 he went on to join University of Minnesota where he obtained his MS and PhD degrees in Computer Science. In 2009, he was awarded the Distinguished Leadership Award for Internationals by the University of Minnesota for his outstanding leadership accomplishments in his professional career.
In his position as the Chief Executive Officer of Unique Identification Authority of India (UIDAI), Dr. Pandey has been steering the Aadhaar project in India since its beginning in 2010. Dr. Pandey has played a key role in drafting of Aadhaar (Targeted Delivery of Financial and Other Subsidies, Benefits and Services) Act, 2016, and Regulations for implementation of Aadhaar Act.
He has been entrusted with the charge of Chairman, GSTN in addition to his regular position of CEO of UIDAI.
Being substantially funded by the government during 2013-16 period, the C&AG has conducted the expenditure audit of GSTN for FY 2013-14, 2014-15 and 2015-16.
The annual report of GSTN for FY 2013-14 1nd 2014-15 has been laid on the table of the Parliament and circulated to all shareholders.
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