GSTN: The Goods and Service Tax Network in India

Post the introduction of GST (Goods and Service Tax) in July 2017, the government of India has given security clearance to GSTN (Goods and Service Tax Network). It is supposed to be the IT backbone of Goods and Service Tax in India. GSTN is a non-government, private limited company under section 8 of the new companies act, incorporated on 28 march 2013.

The government of India will use this GSTN portal to track down all the financial transactions and provide varied services to the taxpayers. The portal is accessible to all-

  • Stakeholders,
  • Government and
  • Taxpayers

All the related information shall be accessible on a single platform. Tax authorities can use it for tracking all transactions, while taxpayers can use GSTN for filing returns, tracking refunds, making compliances etc.

Features of GSTN:

  • Ownership: It is partly owned by central government and partially by private sector banks and other institutions.
  • Technology partner: Infosys was given the contract to develop this technological backend of GSTN in September 2015.
  • Management: The team of GSTN is chaired by Navin Kumar.
  • Dynamic Nature: The main purpose behind implementing GSTN is to provide a common one stop IT interface for serving the needs of the stakeholders.

Functions undertaken by GSTN:

GSTN acts as a medium for the taxpayers of the country and the Department to interact with each other. It should also be noted that GSTN will not retain any part of the amount paid as tax. It is a portal which facilitates end to end compliance in accordance with GST Tax. GSTN is also capable of handling the most complex IGST transactions. It will also provide the facility to the taxpayers for their tax payments and refunds.

The most popular functions presently undertaken on GSTN portal are-

  • 1.Statutory Functions and
  • 2.Non- Statutory Functions
Statutory Functions Non- Statutory Functions
Approval of Registration Core services like --
  1. Registration
  2. Returns
  3. Payments
Audit and Enforcement Helpdesk Support
Recovery IGST Settlement
Analytics Analytics

Simplified Structure of GSTN

The current GSTN structure has been adopted after the approval of the Finance Ministers of states and the Union Government.

  • GSTN’s equity share of 51% is held by the private players and the rest of 49% is held by the government ( divided between the central and state government).
  • Central government holding is much larger than the private holding, so this ensures that the government has a hold over this institution.
  • Data of the taxpayer is also in safe hands of the government and misuse of the same is not possible.
Simplified Structure of GSTN

Goods and Service Tax Identification Number

Once a taxpayer is registered on the portal he/she is given a unique business identification number called GSTIN. It is a 15 digit number used when you file your returns. The chances of tax manipulation and evasion is reduced as it creates a transparency in transactions.

  • The first two digits here are denoting the unique state code. For Example- The state code of Odisha is 21.
  • The next 10 alphabets here denote the PAN card number the taxpayer holds.
  • The 13th digit is of the registration number which the taxpayer has been alloted.
  • The 14th digit "G” by default, it is not specifying anything.
  • The 15th digit can be a number or alphabet, it is a sum check.
Goods and Service Tax  Identification Number

GSTN is planning to introduce a new messaging facility for the dealers and sellers as well wherein both the parties will be able to converse with each other. GSTN has also signed a memorandum of understanding with IHMCL to link Fastag with GST e-way bill system.

GST Infrastructure

The GST network developed, GST portal works as the front end of IT ecosystem for the tax payments in India. The back ends of the systems would be CBEC and individual state tax department.

The functions of the front end desk are:
  • Registration application filling.
  • Return filing
  • Challen creation
  • IGST payment settlement
  • Analysis and generation of Business.
GST Infrastructure

How to Apply for GSTIN

GSTIN is completely free of cost and is a part of GSTN registration process. After the taxpayer submits the duly filled application, the GST officer rectifies it. After the completion of the entire process the trader or the business is allotted a unique 15-digit registration id.

GSTN registration can be done through two different ways:
  • In a GST Sewa Kendra
  • Or, through GST portal
CA Abhishek Soni
CA Abhishek Soni

Abhishek Soni is a Chartered Accountant by profession & entrepreneur by passion. He is the co-founder & CEO of Tax2win is amongst the top 25 emerging startups of Asia and authorized ERI by the Income Tax Department. In the past, he worked in EY and comes with wide industry experience from telecom, retail to manufacturing to entertainment where he has handled various national and international assignments.