Under GST we have 3 situations where an audit of books is done:
1. When the aggregate turnover exceeds 2 crore rupees.
2. An audit by tax authorities
3. Special Audit
Threshold turnover For Audit [ u/s 35(5) CGST]
Audit of accounts is required when the turnover during the financial year exceeds 2 crore prescribed limit rupees.
Turnover shall be the aggregate of taxable, exempted, inter-state and export supply.
It should be carried out by either a Chartered Accountant [CA] or a Cost Accountant [CMA]
Following documents should be furnished:
- Audited Annual Accounts
- Annual Return in Form GSTR-9
- Reconciliation Statement in Form GSTR 9C duly certified by a CA or CMA
Due Date
The due date for filing Form GSTR 9C form FY 2017-18 is 30th December 2018
It should be filed along with the annual return form GSTR 9 and audited annual accounts.
Read: How To Do Accounting Under GST? and Accounts to be maintained under GST.
Audit by tax authorities [u/s 65 CGST]
| Audit By Tax Authority [ u/s 65 CGST] | |
| Audited By | The Commissioner or any officer authorized by him |
| OF | Any registered person |
| Place of Audit | The place of business of the registered person or in Authority’s office |
| Notice of Audit | Not less than fifteen working days prior to the conduct of the audit in Form GST ADT – 01 |
| Finalisation of Audit | Within a period of 3 months from the date of commencement of the audit. Authority may, for the reasons to be recorded in writing, extend the period by a further period not exceeding 6 months |
| Power of Authority | Require the registered person- (i) to afford him the necessary facility to verify the books of account or other documents as he may require; (ii) to furnish such information as he may require and render assistance for timely completion of the audit. |
| Duty of Authority | Inform the registered person, within thirty days, about the findings, his rights and obligations and the reasons for such findings in form GST ADT-02 |
| If loss of revenue detected | Authority may initiate action under section 73(not by reason fraud) or section 74 (by reason fraud). |
Note: 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 by the registered person or the actual institution of audit at the place of business, whichever is later.
Special Audit [ u/s 66 CGST]
| Special Audit [ u/s 66 CGST] | |
| Audited By | Any officer, not below the rank of Assistant Commissioner may, with the prior approval of the Commissioner, direct audit of record by a chartered accountant or a cost accountant as may be nominated by the Commissioner in FORM GST ADT-03. |
| OF | Any registered person |
| Reason for Audit | After considering the nature and complexity of the case and the interest of revenue, the officer is of the opinion that the value has not been correctly declared or the credit availed is not within the normal limits. |
| Finalisation of Audit | Within the period of 90 days. Provided that the Assistant Commissioner may, on an application made to him in this behalf by the registered person or the chartered accountant or cost accountant or for any material and sufficient reason, extend the said period by a further period of 90 days. |
| Other Matters | 1. Special Audit has to be done even if the accounts of the registered person have been audited under any other provisions of this Act or any other law for the time being in force. 2. The registered person shall be given an opportunity of being heard in respect of any material gathered on the basis of the special audit which is proposed to be used in any proceedings against him under this Act or the rules made thereunder. 3. The expenses of the examination and audit of records for special audit, including the remuneration of such chartered accountant or cost accountant, shall be determined and paid by the Commissioner and such determination shall be final. |
| Duty of Authority | On conclusion of the special audit, the registered person shall be informed of the findings of the special audit in FORM GST ADT-04 |
| If loss of revenue detected | Authority may initiate action under section 73(not by reason fraud) or section 74 (by reason fraud). |
Source: Central Goods and Services Tax Act 2017 and Central Goods and Services Tax (CGST) Rules, 2017.
About Author
Pravin Giri
(@Pravin) Twitter | FacebookPravin is a Qualified Chartered Accountant [CA]. Gives opinions on Income tax, GST, and finance.Find him on Twitter @Pravinkumargiri
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