Assessment and Audit in GST Law: In the Central Goods and Services Tax Act, 2017 Chapter XII (Sec. 59 to Sec. 64) and Chapter XIII (Sec. 65 and Sec. 66) deals with assessment and audit respectively. The topic wise discussion on assessment and audit is as under:
VARIOUS ASSESSMENTS IN GST LAW
Self Assessment (Section 59)
Section 59 provides that every registered person shall self-assess the taxes payable under this Act and furnish a return for each tax period as specified under section 39.
Provisional Assessment (Section 60)
(1) Section 60 deals with Provisional Assessment. Where the taxable person is unable to determine the value of goods or services or both or determine the rate of tax applicable thereto, he may request the proper officer in writing giving reasons for payment of tax on a provisional basis and the proper officer shall pass an order, within a period not later than 90 days from the date of receipt of such request, allowing payment of tax on provisional basis.
(2) The payment of tax on provisional basis is allowed on execution of a bond and with such surety or security as the proper officer may deem fit, binding the taxable person for payment of the difference between the amount of tax as may be finally assessed and the amount of tax provisionally assessed.
(3) The proper officer shall, within a period not exceeding 6 months from the date of the communication of the provisional assessment order, pass the final assessment order after taking into account such information as may be required for finalizing the assessment:
Note: The period specified in this sub-section may, on sufficient cause being shown and for reasons to be recorded in writing, be extended by the Joint Commissioner or Additional Commissioner for a further period not exceeding 6 MONTHS and by the Commissioner for such further period not exceeding 4 YEARS.
(4) The registered person shall be liable to pay interest on any tax payable on the supply of goods or services or both under provisional assessment but not paid on the due date specified under sub-section (7) of section 39 or the rules made there under, at the rate specified under sub-section (1) of section 50, from the first day after the due date of payment of tax in respect of the said supply of goods or services or both till the date of actual payment, whether such amount is paid before or after the issuance of order for final assessment.
(5) Where the registered person is entitled to a refund consequent to the order of final assessment under sub-section (3), subject to the provisions of sub-section (8) of section 54, interest shall be paid on such refund as provided in section 56.
Scrutiny of Returns (Section 61)
(1) The proper officer may scrutinize the return and related particulars furnished by the registered person to verify the correctness of the return and inform him of the discrepancies noticed, if any, in such manner as may be prescribed and seek his explanation thereto.
(2) In case the explanation is found acceptable, the registered person shall be informed accordingly and no further action shall be taken in this regard.
(3) In case no satisfactory explanation is furnished within a period of thirty days of being informed by the proper officer or such further period as may be permitted by him or where the registered person, after accepting the discrepancies, fails to take the corrective measure in his return for the month in which the discrepancy is accepted, the proper officer may initiate appropriate action including those under section 65 or section 66 or section 67, or proceed to determine the tax and other dues under section 73 or section 74.
Assessment of Non-Filers of Returns (Section 62)
(1) Notwithstanding anything to the contrary contained in section 73 or section 74, where a registered person fails to furnish the return under section 39 or section 45, even after the service of a notice under section 46, the proper officer may proceed to assess the tax liability of the said person to the best of his judgement taking into account all the relevant material which is available or which he has gathered and issue an assessment order within a period of five years from the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates.
(2) Where the registered person furnishes a valid return within thirty days of the service of the assessment order under sub-section (1), the said assessment order shall be deemed to have been withdrawn but the liability for payment of interest under sub-section (1) of section 50 or for payment of late fee under section 47 shall continue.
Assessment of unregistered Persons (Section 63)
Where a taxable person fails to obtain registration even though liable to do so or whose registration has been cancelled under sub-section (2) of section 29 but who was liable to pay tax, the proper officer may proceed to assess the tax liability of such taxable person to the best of his judgment for the relevant tax periods and issue an assessment order within a period of five years from the date specified under section 44 for furnishing of the annual return for the financial year to which the tax not paid relates:
Note: No such assessment order shall be passed without giving the person an opportunity of being heard.
Summary Assessment in certain Special Cases (Section 64)
(1) The proper officer may, on any evidence showing a tax liability of a person coming to his notice, with the previous permission of Additional Commissioner or Joint Commissioner, proceed to assess the tax liability of such person to protect the interest of revenue and issue an assessment order, if he has sufficient grounds to believe that any delay in doing so may adversely affect the interest of revenue:
Provided that where the taxable person to whom the liability pertains is not ascertainable and such liability pertains to supply of goods, the person in charge of such goods shall be deemed to be the taxable person liable to be assessed and liable to pay tax and any other amount due under this section.
(2) On an application made by the taxable person within thirty days from the date of receipt of order passed under sub-section (1) or on his own motion, if the Additional Commissioner or Joint Commissioner considers that such order is erroneous, he may withdraw such order and follow the procedure laid down in section 73 or section 74.
AUDIT OF BOOKS AND RECORDS IN GST LAW
Audit by Tax Authorities
As per provisions of the Section 65 the Commissioner may by way of order may undertake audit of any registered person at the place of business of the registered person or in their office. The registered person shall be informed by way of a notice not less than fifteen working days prior to the conduct of audit. The said audit should be completed within a period of 3 months from the date of commencement of the audit.
Special Audit by a Chartered Accountant or a Cost Accountant
If at any stage of scrutiny, inquiry, investigation or any other proceedings before him, any officer not below the rank of Assistant Commissioner, having regard to the nature and complexity of the case and the interest of revenue, is of the opinion that the value has not been correctly declared or the credit availed is not within the normal limits, he may, with the prior approval of the Commissioner, direct such registered person by a communication in writing to get his records including books of account examined and audited by a chartered accountant or a cost accountant as may be nominated by the Commissioner.
The chartered accountant or cost accountant so nominated shall, within the period of ninety days (said period can be extended by a further period of ninety days), submit a report of such audit duly signed and certified by him to the said Assistant Commissioner.
The expenses of the examination and such Special Audit of records, including the remuneration of such chartered accountant or cost accountant, shall be determined and paid by the Commissioner and such determination shall be final.
