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Tax Audit Procedures and Guidelines

The document discusses the audit process under Section 65 of the GST Act. It outlines who can conduct audits, how they are conducted, where they take place, the notice requirements, timelines, powers of authorized officers during audits, obligations after conclusion, and potential initiation of proceedings based on audit findings. Specifically, it notes that only the Commissioner or authorized officers can conduct audits, which may take place at the registered person's place of business or the GST office, with 15 days notice required. Audits must be completed within 3 months but can be extended up to 6 months total.

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Shiwang Agrawal
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155 views8 pages

Tax Audit Procedures and Guidelines

The document discusses the audit process under Section 65 of the GST Act. It outlines who can conduct audits, how they are conducted, where they take place, the notice requirements, timelines, powers of authorized officers during audits, obligations after conclusion, and potential initiation of proceedings based on audit findings. Specifically, it notes that only the Commissioner or authorized officers can conduct audits, which may take place at the registered person's place of business or the GST office, with 15 days notice required. Audits must be completed within 3 months but can be extended up to 6 months total.

Uploaded by

Shiwang Agrawal
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd

Audit by Tax Authorities

Section 65
WHO CAN CONDUCT THE AUDIT AND HOW THE AUDIT IS CONDUCTED
Sec 65(1)

• Only following persons can conduct the audit: -


1. Commissioner
2. Any officer authorized by the Commissioner

• Audit can be conducted: -


1. Either by way of a General Order or
2. By way of a Specific Order.

• Audit can be done only of a Registered Person.

• The Commissioner or any officer authorized by him, may undertake audit of any Registered Person.
Use of the word “May” indicates that it is not necessary to conduct the audit of all the Registered Persons for all the Periods. It
shall be at the discretion of the Commissioner whether he wants to conduct audit or not.

• Audit shall be conducted for such period as may be prescribed.

• Audit shall be conducted at such frequency as may be prescribed.

• Audit shall be conducted in such manner as may be prescribed.


PLACE FOR CONDUCTING THE AUDIT
Sec 65(2)

• The Commissioner or the officer authorized by the Commissioner may conduct audit: -

 Either at the place of business of the Registered Person or;


 In their office i.e. office of the GST Authorities.
NOTICE TO REGISTERED PERSON FOR CONDUCTING THE AUDIT
Sec 65(3)

• The Registered Person shall be informed about the Audit.

• The Registered Person shall be informed by way of a Notice.

• Such Notice should be served at least 15 days prior to the conduct of audit.

• The manner of informing the Registered Person shall be prescribed.


TIME PERIOD FOR COMPLETION OF AUDIT
Sec 65(4)

• Audit shall be completed within a period of 3 months.

• This period of 3 months shall be counted from the date of commencement of the audit.

• Where the Commissioner is satisfied that the Audit cannot be completed within 3 months, then, he may extend the period by a
further period not exceeding 6 months.
The reasons for extending the period should be recorded in writing.

Explanation
“Commencement of Audit” shall mean later of the following 2 dates: -
 Date on which the records/other documents, called for by the tax authorities, are made available or
 The date of actual institution of Audit at the place of business.
POWERS OF THE AUTHORISED OFFICER (AUDITOR)
Sec 65(5)

• During the course of Audit, the authorized officer may require the Registered Person: -

 To afford him the necessary facility, as he may require, to verify the books of accounts/other documents.

 To furnish such information, as he may require, for timely completion of Audit.

 To render assistance for timely completion of Audit.


OBLIGATIONS OF THE AUTHORISED OFFICER (AUDITOR) ON AUDIT CONCLUSION
Sec 65(6)

• On conclusion of Audit, the Proper Officer shall, within 30 days, inform the Registered Person about the following: –

 The findings of the Audit.

 The reasons for such findings.

 The Rights & Obligations of the Registered Person.


INITIATION OF PROCEEDINGS U/S 74 OR 75
Sec 65(7)

• Where the audit conducted results in detection of: -

 Tax not paid; or


 Tax short paid; or
 Tax erroneously refunded; or
 ITC wrongly availed; or
 ITC wrongly utilized

The proper officer may initiate action u/s 73 or u/s 74.

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