Overview-Section 61 Scrutiny of Returns
Scrutiny of Returns
√ As per section-61 , proper officer may scrutinize the return and related particulars furnished by the registered person to verify the correctness of the return and
√ Inform him of the discrepancies noticed, if any, in such manner as may be prescribed and
√ Seek his explanation thereto.
√ In legal parlance, it is considered to be a pre-adjudication process.
√ The process of adjudication is provided in Sections 73 to 75 of the Act.
Steps undertaken in Section-61, Scrutiny of returns
> Proper Officer issues notice in the FORM GST ASMT-10, informing of such discrepancies and seeking his explanation.
> The registered person may accept the discrepancy mentioned in the notice issued and pay the tax, interest and any other amount arising from such discrepancy and inform the same or furnish an explanation for the discrepancy in FORM GST ASMT- 11 to the proper officer.
> Where the explanation furnished by the registered person or the information submitted found to be acceptable, the proper officer shall inform him accordingly in FORM GST ASMT-12.
What resolutions are available…?
> On issuance of notice to taxable person, Discrepancy must conclude within a maximum period of 30 days from the date of service of the notice and be resolved in one of the three ways listed in the section i.e.
1) Admission and rectification or explanation
2) Non Admission
3) Admission but In action by taxpayer.
Important point to be noted is.
In case of Inaction or Non Admission by Taxable Person, Proper Officer can not issue ‘order of demand’ out of section 61 itself. Although, scrutiny can give rise to evoking following provisions:-
Can officer call for Books & Records?
Essential ingredients for Scrutiny of returns under section-61
♦ Proper Officer
Discrepancy–is an inconsistency or inaccuracy which is a very important requirement to invoke section 61 that the Proper Officer must „discover‟ from within the returns itself. Section 61 does not permit investigation into new things not emerging from the returns as there other provisions with checks and balances to undertaken investigation
Meaning of Discrepancies from within returns..?
Some Examples for Discrepancies from within the returns.
Some Examples for Discrepancies from external information which is not available from within the returns
These instances do not represent to be based on any circulars or court decisions but prepared based on understanding of underlying issues for various contributors.