Audit under GST law signifies examination of books and accounts of the registered taxable person to vouch for the correctness of information furnished, input tax credit availed, refund claimed and tax liability discharged.
Every taxable person registered under GST, whose turnover during the financial year exceeds 2 crore rupees, is required get his accounts audited by a CA (Chartered Accountant) or a CMA (Cost and Management Accountant). The taxable person who is required to get his accounts audited as per be provisions contained under section 35(5) shall furnish the Annual Return electronically along with a copy of an audited statement and the reconciliation statement, reconciling the value of supplies stated in the return furnished for the financial year with the audited annual financial statement, a copy of certified audited annual accounts in Form GSTR-9C with annual return.
Every taxable person registered under GST shall maintain his accounts to show the correct value in regards to:
Audit by the Tax Authorities:
The Commissioner or any officer authorized by him may conduct an audit of a registered person under the GST law. However, the manner and the of the audit will be prescribed later.
Time limit for completion of the GST audit
The audit under the GST needs to be completed within three months from the date of commencing the audit. However, such period can be extended for a further period of 6 months by the Commissioner.
GST Audit Procedure of conducting the Audit
The authorised officer and officials accompanying him shall conduct the audit of the books and accounts of the registered person, they will verify all the requisite documents i.e. shall verify the books maintained by the registered person and the return and statements furnished under the act. The proper officer and his team shall verify the correctness of the turnover, the rate of tax applied on the supply of goods or services or both, exemptions and deductions claimed, refund claimed, the input tax credit availed and utilized and record the findings in the audit notes.
During the course of GST audit, the proper officer may require the auditee,—
The authorized officer may inform the person whose records are audited any discrepancies noticed if any, and the said registered person may file his reply and the proper officer shall finalise the findings of the audit after considering the reply furnished.
Finalisation of Audit
If the audit results in any detection of any sum unpaid/short paid or wrongly refunded or wrongly an ailment of input tax credit, then demand and recovery actions will be initiated.