Hello friends, greetings for the day in the current article we will discuss about the maintenance of accounts and records as per the provisions of CGST Act.

Introduction

Assessment in GST is mainly focused on self-assessment by the taxpayers themselves. Every taxpayer is required to self-assess the taxes payable and furnish a return for specified tax periods i.e. the period for which return is required to be filed. The compliance verification is done by the department through scrutiny of returns, audit and/or investigation. Thus, the compliance verification is to be done through documentary checks rather than physical controls. This requires certain obligations to be cast on the taxpayer for keeping and maintaining accounts and records

Accounts and records:- what CGST Act says?

As per section 35 of CGST Act every registered person shall keep and maintain, at his principal placed of business as mentioned in the certificate of registration, a true and correct account of:-

  • Production or manufacture of goods
  • Inward and outward supply of goods or service or both
  • Stock of goods
  • Input tax credit availed
  • Output tax payable and already paid

Provided that where more than one place of business is specified in the certificate of registration, the accounts relating to each place of business shall be kept at such places of business and the registered person may keep and maintain such accounts and other particulars as may be prescribed.

If further states that every owner or operator of warehouse or any other place used for storage and every transporter, irrespective whether he is registered person or not, shall maintain shall maintain record of consigner,  consignee etc.

According to sec 35(5) of CGST Act every registered person whose turnover during a financial year exceeds “Two Crore” shall get his accounts audited by a Chartered accountant or a cost accountant and shall submit a copy of audited annual accounts along with the reconciliation statement.

Accounts and records:- what CGST Rules 2017 says?

  • As per rule 56 every registered person shall keep and maintain in addition to the particular mentioned in 35(1), a true and correct account of goods or services imported or exported or supplies attracting “Reverse charge payment of tax”.
  • Every registered person other than person paying tax under composition scheme shall maintain the accounts of stock in respect of goods received and supplied by him and registered person should also maintain separate account for advance received, paid and adjusted.
  • Every registered person shall keep the particulars of –
  • names and complete addresses of suppliers from whom he has received the goods or services chargeable to tax under the Act;
  • names and complete addresses of the persons to whom he has supplied goods or services, where required under the provisions of this Chapter;
  • the complete address of the premises where goods are stored by him, including goods stored during transit along with the particulars of the stock stored therein
  • If any taxable goods are found to be stored at any place(s) other than those declared under sub-rule 56(5) without the cover of valid documents then the proper officer shall determine the amount of tax payable on such goods as if such goods have been supplied by the registered person.
  • Every registered person shall also maintain books of accounts relating to additional place of business and any entry in books shall not be erased, effected or overwritten however any kind of clerical mistakes should be scored out under proper attestation.
  • Every registered person shall also maintain monthly production accounts showing quantitative details and the records can also be maintained in electronic form and the records so maintained shall be authenticated by means of a digital signature.
  • All the accounts along with the records to be maintained by registered person has to be preserved for seventy two months (Six years).
  • Every person required to maintain records and accounts in accordance with the provisions of sub-section (2) of section 35, if not already registered under the Act, shall submit the details regarding his business electronically on the common portal in

FORM GST ENR-01,either directly or through a Facilitation Center notified by the Commissioner and, upon validation of the details furnished, a unique enrollment number shall be generated and communicated to the said person.

For the purposes of Chapter XVI of these rules, a transporter who is registered in more than one State or Union Territory having the same Permanent Account Number, he may apply for a unique common enrollment number by submitting the details in FORM GST

ENR-02 using any one of his Goods and Services Tax Identification Numbers, and upon validation of the details furnished, a unique common enrollment number shall be generated and communicated to the said transporter. 

Attention is invited to Circular No. 23/23/2017- GST dated 21.12.2017 which provides relaxation from maintenance of books of accounts relating to additional place of business by a principal or an auctioneer for the purpose of auction of tea, coffee, rubber etc. subject to prescribed conditions.

In case of any doubts in the current topic or provisions of Indirect taxation (GST and CUSTOMS) then you may contact us at abhutpurv@gmail.com

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