GST: Audit by tax Authority, Special Audit & Annual GST Audit

Section 65 – GST Audit by tax Authority

(1) Authority Commissioner or any officer authorised by him

(2) At place of business of the registered person or at their office

(3) 15 working days prior notice

(4) Audit shall be completed within a period of three months from the date of commencement of the audit (where the Commissioner is satisfied that audit cannot be completed within three months, he may, for the reasons to be recorded in writing, extend the period by a further period not exceeding six months.)

Explanation. For the purpose of this sub section, the expression “commencement of audit” shall mean the date on which the records and other documents, called for by the tax authorities, are made available to tax authorities, or the actual date of institution of audit at the place of business, whichever is later.

(5) Powers of authority

    (i) Afford necessary facility to verify books of account

    (ii) Furnish such information as he may require

(6) On conclusion of Audit proper officer shall, within thirty days, inform the registered person, whose records are audited, about the findings, his rights and obligations and the reasons for such findings.

(7) Where the audit conducted results in detection of tax not paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the proper officer may initiate action under section 73 or 74.

Section 66 – Special GST Audit

(1) If at any stage of scrutiny, inquiry, investigation or any other proceedings before him ,any officer not below the rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of the revenue, is of the opinion that the value has not been correctly declared or the credit is not within normal limits, he may ,with the prior approval of commissioner, direct such registered person by a communication in writing to get his records including books of accounts examined and audited by a chartered accountant or a cost accountant as may be nominated by a commissioner

(2) The chartered accountant or cost accountant to submit report within the period of 90 days duly signed and certified to the said Commissioner.(which may be extended by a commissioner for a further period of ninety days on application made)

(3) Special audit to be conducted even if the accounts are already audited under any other law

(4) The registered person shall be given opportunity of being heard before utilising any material gathered on the base of audit in any proceedings against him under the act.

(5) Expenses of the examination and audit of records to be borne by the Commissioner.

(6) Where the audit conducted results in detection of tax not paid or short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the proper officer may initiate action under section 73 or 74.

Section 35(5) Annual GST Audit

Every registered person whose turnover during the financial year exceeds Rs.2 Crore shall get his accounts audited by chartered accountant or cost accountant and shall submit a copy of audited annual accounts ,the reconciliation statement and other documents along with the GST annual return. Last due date for filing GSTR -9 (Annual return) for FY 17-18 is extended by CBIC till 31^st March 2019

Late fees for not filing the GSTR 9 within the due date is Rs. 100 per day per act up to a maximum of an amount calculated at a quarter percent (.25%)of the taxpayer turnover in the state or union territory. Thus it is Rs 100 under CGST & 100 under SGST, the total penalty is Rs 200 per day of default. There is no late fee on IGST.