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September 1, 2021

GST Taxpayers may be randomly selected for Audit by Department

by CA Shivam Jaiswal in GST

GST Taxpayers may be randomly selected for Audit by Department

What is Audit?

  1. Audit is verification of the original records, Returns and other documents of the taxpayers
  2. and correlating them with the information furnished by the taxpayer
  3. to assess their compliance with the provisions of Act and Rules
  4. For Audit taxpayer is required to make the books of accounts and records available

Important inform Lion for taxpayers

  • Audit Team can examine audit documents of taxpayer’s original records either in the office of the Tax Official or at the business premises of the taxpayer
  • Required to provide access to his/her places of business to Audit Team, if so desired
  • Audit will include all Additional Places of business
  • Intimation given to the Taxpayer by giving notice of at least 15 working days prior to the conduct of audit
  • Generally Audit will be concluded within 3 months of its commencement. In certain cases, it may be extended by another 6 months by Audit Team
  • Audit Report will be made available to taxpayers within 30 days from the date of conclusion of Audit proceedings
  • Audit can be conducted for part year, complete year or multiple years
  • Generally records up to last 5 years can be sought for Audit
  • Also has an option to seek adjournment of certain proceedings
  • The process may lead to the issuance of notices and report to the taxpayer based on the observations and findings by the Audit Team
  • In case of non compliance with any of the notices, taxpayer can be summoned by Audit Officer
  • In case taxpayer does not discharge his liabilities, as contained in Audit Report, liable to be issued with SCN

Types of notices that can be issued to a Taxpayer

Nature of CommunicationPurpose of Communication                                                                                                                                                                                       GST
Notice for conducting Audit under u/s 65(3)
When Audit Officer issues Notice to initiate the audit of the taxpayer by
giving notice of at least 15 working days prior to the conduct of audit.
Notice calling Additional Information*When Audit Officer issues notice for additional information from the
Notice for Discrepancy under rule 101(4)*When Audit Officer issues notice of discrepancy to the taxpayer
Addl. Notice for Disc. under rule 101(4)*When Audit Officer issues additional notice of discrepancy to the taxpayer
Audit Report in Form GST ADT-02When Audit Officer issues findings of Audit u/s 65 (6) to the taxpayer
SummonsWhen Audit Officer issues summons to the taxpayer, if the taxpayer doesn’t
cooperate in the process of audit. Tax officer can issue summons to the
taxpayers after ten days of issues of notice.
Audit: SCN u/s 73/74 and GST DRC-01When Audit Officer issues a notice, after issuing audit report, if detection
amount is not paid/ short paid; or if taxpayer is not supporting the audit
Request for adjournment of AuditIf taxpayer is not ready with the documents and want more time, they can
request for adjournment of audit to the Audit Officer
Request for Adjournment can be initiated only for Notice for conducting
Audit under u/s 65(3) (GST ADT-01)
  • Notice Related to GST Audit is visible under Service>User Services>View Additional Notices/Orders
  • Tax Official can send up to 3 Reminders if you don’t reply to the previous notice
  • Tax Payer can file multiple reply or counter reply against single notice/report

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