SUB GST p2.9

Audit under GST

22 May 2020

Audit means the examination of records, returns and other documents maintained or furnished by a registered person under Goods and Services Tax Act are the rules made thereunder any other law for the time being in force to verify the correctness of turnover declared, taxes paid, refund claim and input tax credit availed, and to assess his compliance with the provision of Goods and Services Tax Act and the Rules made thereunder.

Types of audit under GST 

• Audit based on turnover: Every registered person whose turnover during the financial year exceeds the limits of Rs.2 Crores get his accounts audited by a Chartered Accountant or a Cost Accountant and shall submit a copy of the audited annual accounts, the reconciliation statement add such other document in such form and manner as may be prescribed. 

• Audit by tax authorities: The commissioner or any officer authorized by him, by way of a general or specific order, may undertake an audit of any registered person for such period, at such frequency and in such manner as may be prescribed. An audit may be conducted at the place of business of the registered person or in their office. The registered person shall be informed by way of a notice not less than 15 working days before the conduct of an audit. The audit shall be completed within 3 months from the date of commencement of the audit. However if the commissioner is satisfied that an audit in respect of such a registered person cannot be completed within 3 months, he may for the reason to be recorded in writing extend the period not exceeding 6 months. On the conclusion of the audit, the proper officer shall, within 30 days, inform the registered person, whose records are audited, about the findings, his rights and obligations, and the reasons for such findings. Audit results in detection of tax not paid or short paid or erroneously refunded, input tax credit wrongly availed or utilized, the proper officer may initiate action. 

• Special audit

  • Discretion for a special audit: if at any stage of scrutiny, inquiry, investigation or any other proceedings, any officer cannot below the rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of revenue, thinks that the value has not been correctly declared on the credit availed is not within normal limits, he may, with the prior approval of the Commissioner, direct such registered person by a communication in writing to get his records including books of account examined and audited by a Chartered Accountant or a Cost Accountant as may be nominated by the Commissioner. The direction shall be issued in FORM GST ADT-03. 

  • The time limit for completion of audit: The Chartered Accountant or Cost Accountant so nominated shall, within 90 days, submit a report of such audit duly signed and certified by who to the Assistant Commissioner mentioning therein such other particulars as may be specified. 

  • Extension of time limit: Assistant Commissioner may, on an application made to him on this behalf by the registered person or the Chartered Accountant or Cost Accountant or for any material and sufficient reason, extend the said period of 90 days.