Daily Dose of GST Update By CA Pradeep Jain
Chapter XVI – Audit
The chapter states the provision relating to the audit to be undertaken by the GST authorities. It prescribes the rights and obligation of the GST authorities in the event of conducting an audit. Not much is proposed in the revised model draft GST law.
One change that has been proposed is that now on the completion of audit, the proper officer has to inform the taxable person, whose records were audited, of the findings within thirty days of the completion of audit. Earlier in the old draft the time limit was not prescribed. This is a welcome step as currently there is no time limit for informing the assessee of the findings. As a result, there is considerable delay in forwarding the audit reports subsequently resulting in delay in proceedings too.
But the time span of completing audit is very large both in old draft GST law as well as revised GST law. Earlier the central excise authorities normally completed the audit within 2 or 3 days. But now the time span of 3 months is very large and it will hurdle the working of the assessee.
Moreover, there was dispute about the conducting the audit at the premises of service provider in case of Mega Cabs. The ratio of this case was that the word “verification” does not include audit. But now there is specific provision for audit by departmental officers. Hence this problem has been resolved by the department in revised GST law.
Another proposed change is insertion of a new section 65 which prescribes Power of CAG to call for information for audit. This section grants the CAG to call for information, records and returns from the proper officer who will be responsible to furnish such information sought to enable the CAG to conduct audit as required under the Comptroller and Auditor General’s (Duties, Powers and Conditions of Service) Act (56 of 1971). Now it seems that AG audit has also been given powers to conduct the audit at the premises of assesee. Earlier there was no provision and it was also subject to litigation. But now both the acts are co-related and hence there cannot be any litigation on the issue.
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