By SBKI News | July 20, 2025
In a shocking incident that highlights the growing digital scrutiny of small traders, a vegetable seller in Haveri district, Karnataka, received a Goods and Services Tax (GST) demand notice of ₹29 lakh — despite never having registered a business turnover anywhere close to that amount.
The trader, who operates from a small stall in a local mandi, was stunned when tax officials notified him of pending dues and violations based on transactions he never conducted. The notice claimed that the trader had engaged in large-scale wholesale activities, allegedly issuing GST invoices worth crores of rupees
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How Did This Happen?
According to initial reports, the GST identification number (GSTIN) was misused or falsely registered in the trader’s name — without his knowledge. This could be a case of identity theft or GST fraud, a trend that has seen a disturbing rise in India over the past year.
The trader, who primarily earns between ₹500 and ₹800 per day, told reporters:
“I don’t even know how GST works. I only sell vegetables in cash. I’ve never done big transactions or taken loans.”
Local officials are now probing how such a massive discrepancy was linked to someone with no digital footprint or formal business registration.
What the Authorities Are Saying
A senior officer from the Commercial Tax Department stated that the GST system flagged the trader’s PAN and Aadhaar-linked credentials, which were used to generate fake invoices across multiple states.
The department has now launched a detailed inquiry and is likely to revoke the notice if the trader is found to be a victim of fraud.
Officials are also planning to issue advisories to small business owners in rural areas, urging them to verify whether their identities are being misused by unscrupulous elements for GST registration.
Insight from the Ground
As a journalist with experience in rural and small-town reportage, I’ve seen firsthand how digital inclusion in India has created both opportunities and vulnerabilities. Small traders like this vegetable vendor often lack digital literacy. Many don’t know how PAN, Aadhaar, or SIM card data could be exploited.
When I visited local markets in Uttar Pradesh and Bihar earlier this year, several traders expressed concern about Aadhaar being linked to multiple services — yet they had little knowledge about how to check or prevent misuse.
This case in Haveri isn’t just a tax issue. It’s a crisis of trust in digital systems that the common man doesn’t fully understand but is still exposed to.
Why This Matters
This incident is not an isolated one. Over the past few months, numerous reports from Madhya Pradesh, Rajasthan, and Uttar Pradesh have surfaced, where small business owners or even daily wage workers were issued GST demands worth lakhs — all due to fraudulent registrations.
It raises serious questions:
Is the GST portal secure enough?
Are there sufficient verification protocols before assigning a GST number?
How do we safeguard individuals with no legal knowledge from such harassment?
What Can Be Done
Experts suggest the following steps to prevent such incidents:
PAN-Aadhaar Usage Alert Systems: Citizens should be notified via SMS/email whenever their credentials are used for business registration.
Free Legal Aid for Victims: Most victims are poor and unaware of legal recourse. The state should offer helplines and legal counsel.
Simpler GST Deactivation Process: If fraud is proven, there must be a faster way to reverse wrongful notices.
Conclusion
The ₹29 lakh GST notice to a humble vegetable seller in Haveri is a stark reminder of the gap between policy and the people. It’s not just about tax enforcement — it’s about the ethical responsibility of the system to protect those who don’t even know they’re vulnerable.
In India’s push for digital governance, ensuring transparency, education, and protection for the under-informed is not optional — it’s urgent.
EEAT (Experience, Expertise, Authoritativeness, Trustworthiness)
This report is written by a journalist with 5 years of experience in public interest and regional news reporting. I specialize in highlighting grassroots issues, socio-economic challenges, and governance outcomes across Indian states, particularly Uttar Pradesh and Bihar. I do not report on court proceedings or legal analysis, but my coverage is grounded in fieldwork, interviews, and firsthand observation of public impact — ensuring trustworthy, citizen-focused journalism.
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Source: LiveMint – Wait, What? Vegetable Trader Gets ₹29 Lakh GST Notice in Haveri, Karnataka
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