A vegetable vendor in Karnataka was shocked to receive a ₹29 lakh GST notice after authorities tracked ₹1.63 crore in UPI digital payments over four years.
Why Was the Notice Issued?
The vendor accepted payments via UPI for daily vegetable sales. Over time, the transactions added up to over ₹1.6 crore. The tax department interpreted this as exceeding the GST threshold and issued the notice.
What Does GST Law Say?
- If your annual turnover exceeds ₹40 lakh (₹20 lakh in some states), you must register for GST.
- The vendor’s average yearly income was over ₹40 lakh — triggering GST liability.
Impact on Small Vendors
This case highlights a key concern — many small traders shifting to digital payments may unintentionally fall into the tax net. While promoting Digital India is essential, lack of awareness could hurt low-income earners.
Key Takeaways for Small Businesses:
- Track your digital income carefully.
- Maintain proper transaction records.
- Consult a tax expert if your income grows.
- Understand GST rules if you cross the income threshold.
Conclusion
This incident is a wake-up call for small vendors accepting UPI. Awareness, record-keeping, and financial guidance are essential to avoid legal complications. Digital growth should be inclusive — not punitive.
What’s your opinion? Should small vendors be exempt from such notices? Comment below and share your views.
Written by:Kapeesh Chaubey