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Audit under GST
As per Section 2(13) of the CGST Act, 2017 ‘Audit in GST’ means the examination of records, returns and other documents maintained or furnished by the registered person under this Act or the rules made thereunder or under any other law for the time being in force to verify the correctness of:
- Turnover
- Taxes paid
- Refund claimed
- ITC availed
- Assessment of compliances with the provisions of this Act or the rules made thereunder.
Departments Rights/ Powers
As per section 71 of the CGST Act, 2017, any officer under this Act, authorised by the proper officer not below the rank of Joint Commissioner, shall have access to any place of business of a registered person to inspect books of accounts, documents, computers, computer programs, computer software whether installed in a computer or otherwise and such other things as he may require and which may be available at such place, for the purposes of carrying out any audit, scrutiny, verification and checks as may be neccessary to safeguard the interest of revenue.Every person in charge of place reffered to in sub- section (1) shall, on demand, make available to the officer authorised under sub- section (1) or the audit party deputed by the proper officer or a cost accountant or chartered accountant nominated under section 66-
(i) such records as prepared or maintained by the registered person and declared to the proper officer in such manner as may be prescribed;
(ii) trial balance or its equivalent;
(iii) statements of annual financial accounts, duly audited, wherever required;
(iv) cost audit report, if any, under section 148 of the Companies Act, 2013 (18 of 2013);
(v) the income-tax audit report, if any, under section 44AB of the Income-tax Act, 1961 (43 of 1961); and
(vi) any other relevant record
Power to call for information
As per Section 151 of the CGST Act, 2017 the Commissioner or an officer authorised by him may, by an order, direct any person to furnish information relating to any matter dealt with in connection with this Act, within such time, in such form, and in such manner, as may be specified therein.
Audit by Tax Authorities (Section 65/ Rule 101)
Order for Audit: The Commissioner or any officer authorised by him, by way of a general or a specific order, may undertake audit of any registered person.
Period of Audit: The period of audit to be conducted shall be a financial year or part thereof or multiples thereof
Place of Audit: The officer may conduct audit at the place of business of the registered person or in their office.
Notice of Audit (ADT-01): The registered person shall be informed by way of a notice not less than 15 working days prior to the conduct of audit.
Time Limit for conducting Audit: The Audit shall be completed within a period of 3 months (further extendable for 6 months) from the date of commencement of the audit
Commencement of Audit: “Commencement of audit” shall mean the date on which the records and other documents, called for by the tax authorities, are made available by the registered person or the actual institution of audit at the place of business, whichever is later.
Rights of Taxpayer during GST Audit
- Right to 15 day notice (ADT-01)
- Right to audit memo and submit reply
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- Right to confidentiality -
Documentation & Preparation for Departmental Audit
- Copies of GSTR-1, GSTR-3B, GSTR-2A, GSTR-9 and GSTR-9C
- Inter-returns reconciliation of GSTR-1 & GSTR-3B, GSTR-2A/2B & GSTR-3B
- Reconciliation of Annual Return with Financial Statements, GSTR-9C and other reconciliations
- GST Registration Certificate, amendment applications and list of place of business including warehouses, shops and place where books of accounts are maintained
- Details of E-Way bill for the audit period for inward and outward supply /movement of goods
- Business profile, Description of the goods/ services supplied with HSN Code, process flow chart, plant & machinery installed with capacity etc.
- Constitution of business, Details of proprietor / partner / CEO/ Chairman / Managing Director as may be applicable
- PAN, CIN, IEC, BIN, Bank Accounts and details of other registrations