New Delhi : The home ministry has given security clearance to the GSTN, the information technology backbone of the Goods and Services Tax regime, paving the way for its operationalisation soon. Security clearance to the Goods and Services Tax Network (GSTN), a not-for-profit private limited company, was delayed as the home ministry was examining threat perception to national security from any of the stakeholders, a ministry official said.
The Goods and Services Tax (GST), which replaces a host of taxes levied by the central and state governments, has come into force from July 1. In the GSTN, five private institutions have 51 per cent equity — HDFC Bank Ltd (10 per cent), HDFC Ltd (10 per cent), ICICI Bank Ltd (10 per cent), NSE Strategic Investment Corporation Ltd (10 per cent) and LIC Housing Finance Limited (11 per cent). The central government has 24.5 per cent equity in the GSTN, whereas state governments, two Union territories and the empowered committee of state finance ministers together hold another 24.5 per cent stake in it.
The procedure for granting security clearance to the GSTN involved background checking of its office-bearers and others concerned. The GSTN has been working overtime to ensure a smooth registration, and all the tax assessees have been given a provisional ID, using which they can start transacting business with the implementation of the GST.
When a business entity registers under GST, it is given a provisional GSTIN. After that, in the second stage, the entity has to log in to the GSTN portal and give details of its business such as the main place of business, additional place, directors and bank account details. BJP MP Subramanian Swamy had earlier opposed the majority stake for private entities in the GSTN and written to Prime Minister Narendra Modi in this regard.
