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Arjuna (Fictional Character): Krishna, notices for scrutiny of returns are being issued by the GST department based on different parameters. Why are these notices being issued by the department?

Krishna(Fictional Character): Arjuna, as per section 61 – Scrutiny of returns read with rule 99, Officer may scrutinize the return furnished by the registered person to verify the correctness of the return and inform him of the discrepancies noticed (Form GST ASMT-10)and seek his explanation thereto.

Arjuna(Fictional Character): Krishna, what are the different parameters covered by the GST department for the purpose of scrutiny of returns?

Krishna (Fictional Character): Arjuna, there is a total of 15 parameters (Parameter 0069 to 0083)based on which GST department is issuing notices for scrutiny of returns as follows:

  • In-eligible ITC claimed from non-genuine taxpayers (NGTPs) whose RC is canceled ab-initio
  • Excess outward tax in GSTR-1 compared to GSTR-9 /GSTR-3B
  • Excess Outward tax in E-Way Bills Compared to GSTR-3B
  • In-eligible ITC claimed from GSTR-3B Non-filers
  • Excess ITC claimed in GSTR-9/3B which is not confirmed in GSTR-2A or 8A of GSTR-9
  • In-eligible ITC claimed from RC is canceled suppliers
  • Less turnover is shown in GSTR-1 compared to GSTR-8 (TCS)
  • Less turnover is shown in GSTR-3B compared to GSTR-7 (TDS)
  • Less RCM liability disclosed in GSTR 9/3B/4 than shown by suppliers in GSTR-1
  • ITC claims after the last date of availing of ITC as per section 16(4) GSTR-3B
  • ITC on purchase invoices uploaded by the supplier in GSTR-1 filed after the last date of availing -section 16(4)
  • Interest on delayed payments made with GSTR 3B
  • Excess IGST on imports shown in GSTR_6E vs. ICEGATE data
  • Excess ISD ITC availed in GSTR9_6G Vs GSTR 2A_ISD
  • Excess RCM ITC GSTR9_6CDF than liability shown in GSTR 9_4G

Arjuna(Fictional Character): Krishna, what action shall be taken by the officer after the explanation for the same has been provided?

Krishna(Fictional Character): Arjuna, in case the explanation is found acceptable (From GST ASMT-11)the registered person shall be informed accordingly in Form GST ASMT-12 and no further action shall be taken in this regard.

In case no satisfactory explanation is furnished or after accepting the discrepancies, fails to take the corrective measure in his return for the month in which the discrepancy is accepted, Officer within a period of thirty days of being informed by noticemay initiate appropriate action including those under section 65/ 66/ 67 or proceed to determine the tax and other dues under section 73/74.

Arjuna(Fictional Character): Krishna, what general precautions should be taken by the taxpayer to avoid such scrutiny of returns by the GST department & what conclusion should we take from this?

Krishna(Fictional Character): Arjuna, all GST returns should be filed duly &to avoid such scrutiny of returns taxpayer should –

Reconcile the details of outward tax declared in GSTR-1 with outward tax declared in GSTR-3B/GSTR-9 and reconcile the same with the E-way bill generated.

Reconcile the Party wise ITC claimed in GSTR-3B/9 with the ITC appearing in GSTR-2A/GSTR-9_8A.

Reconcile the turnover over which TCS/ TDS collected and paid through GSTR-8/ 7 with turnover over which is declared in GSTR-1/ 3B

Ensure tax paid under RCM declared in GSTR-9_4G is more than or equal and claim made under GSTR-9_6D is less than or equal to RCM liability reflected in GSTR_2A on the basis of GSTR-1 furnished by the supplier.

Ensure GSTR-3B has been furnished within due date and if there is any delay in furnishing return interest liability on taxes discharged through cash component have been duly paid.

Reconcile IGST paid and import on ICEGATE with a claim made under GSTR-9_6E and GSTR-3B_4(A)(1)/ (4).

The auditor must ensure that tax declared under GSTR-9_6G is less than or equal to GSTR-2A_ISD and GSTR-9_4G is greater than or equal to GSTR-9_6CDF.

Arjuna (Fictional Character): Krishna, what are the problems which a taxpayer will face?

Krishna (Fictional Character): Arjuna, sometimes it will happen that the honest taxpayer will pay for the mistakes made by others, like in ITC parameters even if the mistake of other taxpayer, the honest taxpayer will suffer.

Author Bio

Qualification: CA in Practice
Company: R.B. Sharma and Co
Location: Aurangabad, Maharashtra, India
Member Since: 27 Jan 2018 | Total Posts: 339
1. Vice-Chairmen of WIRC of ICAI for the year 2015-2021. 2. Youngest Chairman of Aurangabad Branch of WIRC of ICAI in 2002. 3. Author of Popular Tax articles series based on Krishna and Arjuna conversation i.e “KARNITI” published in Lokmat on every Monday. Till date 335+ weekly articles ha View Full Profile

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