GSPs left frustrated as shifting time lines, tech hurdles haunt GST network


BENGALURU|NEW DELHI: Each one of the 34 GST Suvidha Providers (GSP) – service providers who help taxpayers comply with the goods and services tax – were in for a surprise on Thursday, September 21. They got an email from GST Network (GSTN), the government organisation which oversees the implementation of the GST, informing them that testing of filings on the platform, which is set to go live in 20 days, will begin immediately.

The email said between the 21st and 24th – GSTR 3B (a simplified return form that needs to be filled in the first six months of GST implementation) and GSTR 1 (a monthly filing that summarises all outward supplies for taxpayers) -will be tested. Though GSTR 1 forms were due to be filed in September, the government pushed back the deadline to October 10. Fluctuating time lines were not the only issue that GSPs were facing.Even the links in the email from GSTN were not opening.

“You are expecting that the whole country has nothing else to do, but wait for GSTN to send this email and start testing,” said the top manager of an exasperated GSP. “Until Saturday the links were not working.”

The manager listed the basic failings which prevented the platform from operating at volumes – the infrastructure is not scaled, the databases are not tuned and indexes are not in place. Unfairly, a lot of blame is being laid on the doorstep of Infosys and GSTN.

Prakash Kumar, the CEO of GSTN, blamed the broken links on the late receipt of the details of participants from states. “Because of the delay, we had to postpone the start date. The link is live now and there is no problem with it,” he said.

One way in which most governments approach large-scale digital project implementation is to divide it across vendors who can keep a check on each other. In this case, Infosys handles it solely on a Build-Operate-Transfer basis, and all fingers are pointed at it or GSTN (its client).

GSTN could have either put its foot down, pushed back and told the GST Council that it can’t be done. Or, they should have pushed Infosys to speedup work. Now GSTN finds itself mediating,” the GSP source said. “The requirements itself have been changing. That makes it hard for the government to enforce penalties and accountability on Infosys.”

However, the GSTN defended its project design skills and added that using multiple vendors and deploying the system in a phased manner was not possible. “With the available time, bringing everyone on the system at once was the only way out. The decision to go for one MSP was taken after due consideration and our experience in other projects where more than one vendor was engaged. Multiple vendors introduces blame game be tween the vendors,” Kumar said.

“We recommend a conversation with our client GSTN,” an Infosys spokesperson said.

Large scale technology projects always face teething issues. For instance, when Tata Consultancy Services began India’s passport services, the initial delivery took over two years to stabilise. The angry officials of the ministry of external affairs talked of fining the company and taking the project away from it in 2010. Seven years later, the passport project is one of India’s most successful large-scale technology implementations.

“Working with the government on projects like this is like juggling knives on fire. It looks good but you are definitely going to get cut and burned,” said an executive with an IT com pany that has worked on government projects. He expects Infosys to remain in the firing line for at least another year. Few days after then CEO Vishal Sikka quit Infosys, independent director Ravi Venkatesan met Finance Minister Arun Jaitley in Delhi who reminded him that GST could not fail. A technical audit of GSTN was due around the time Sikka quit and Infosys asked for more time.

At a meeting in Bengaluru last week, the group of ministers (GoM), set up to sort out technical problems, fixed timelines for Infosys to fix the glitches and said 70% of the software issues would be sorted by October 30.

“While there is some progress in resolving some issues, many problems continue to persist. The GOM is meeting again on October 4 to review the progress. The GOM will continue to meet alternate week till there is satisfactory resolution of GSTN issues,” said Krishna Byre Gowda, Karnataka’s agriculture minister who is also a GST council member and a member of GoM set up to address GSTN issues.

Experts argue that the kinks will be smoothed out in a few months, as is the case with most technology implementations. “The market is learning. The taxpayers are learning. People who are uploading on behalf of the tax payers are also learning,” said the head of a second GSP, who requested anonymity.

He attributed the problems the GST portal is facing to two broad factors. One, the range of interpretations of law being made by millions of taxpayers. This “diversity” is at odds with the consistent format(s) of filing data that any software product or platform requires.

This leads to the second factor – the artificial load created by erroneous filings, which are rejected by the portal. The processing time needed to reject input, which again comes back when people correct and upload, creates a vicious cycle.Earlier this month, the entire platform slowed down because a bank made a mistake in how it uploaded its invoices. Kumar argued that these are teething issues. The system does alert the taxpayers of errors and in most cases, they correct and upload it again, he said. “One of the major reasons was wrong or non-activated GSTINs, which will be resolved soon… We expect rejections to come down drastically next month,” he said.

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