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GST Audit

See the related post : List of Revised GST Tax Rates

GST Audit is the examination of records maintained by the registered taxable person with the aim to verify the correctness of information declared, taxes paid and to assess the compliance with the provisions of GST.

ICAI clarifies through an announcement dated 28th September 2018 that an Internal Auditor cannot undertake GST Audit simultaneously.

When GST audit is required-

It is required under three circumstances as under-

  1. Audit by Registered person
  2. General Audit by Commissioner
  3. Special Audit by Chartered Accountant

The registered taxable person will be required to produce all the necessary documents or information with in time, which is required under audit to a Chartered Accountant or Cost Auditor.

Audit by Registered person-
It is required for the registered dealer, if his total turnover for the financial year exceeds Rs. 2.00 crore shall get his accounts audited by Chartered Accountant or Cost Accountant and shall submit a copy of audited annual accounts, the reconciliation statement in form GSTR-9C along with GST annual return on or before 31st December.
For example, for the financial year 2017-18, the annual return should be submitted on or before 31st December 2018.

For conducting an audit by the registered person, keep the following information ready for audit purpose-

  • Details of outward supply of goods/services
  • Details of inward supply of goods/services
  • Details of outward tax payable (i.e. IGST payable, UTGST payable, CGST payable or SGST payable), if any
  • Details of input tax credit availed (i.e. IGST receivable, UTGST receivable, CGST receivable or SGST receivable), if any
  • Details of taxes paid (i.e. IGST/CGST/SGST/UTGST), if any
  • Details of Production or manufactured goods
  • Details of stock


General Audit by Commissioner-
The Commissioner or any officer authorized by him, by way of a general or a specific order, may undertake GST audit of any registered person for a such period, at such frequency and in such manner as may be prescribed.

Audit may be conducted at the place of business of the registered person or in the office of the Commissioner or officer authorized by him.

A notice in GST ADT 01 will be sent to the registered person at least 15 days prior to the conduct of the audit.

The audit must be completed within a period of 3 months from the date of commencement of the audit. If the Commissioner satisfied with the reasons recorded in writing, can allow and extend the audit period for a further period of 6 months.

During the audit, the authorized officer may require the registered person –

  1. To afford him the necessary facility to verify the books of account or other documents as he may require.
  2. To furnish such information as he may require and render assistance for timely completion of the audit.

On conclusion of GST audit, the officer shall inform the registered person within 30 days about the findings, his rights and obligations and the reason for such findings. After completion of audit, the findings during the audit in form GST ADT 02 to be provided to registered person with in time.

When the audit conducted results in detection of unpaid/short paid tax or wrong refund or wrong input tax credit availed, then demand and recovery actions will be initiated.


Special Audit by Chartered Accountant-
During the scrutiny, inquiry, investigations or any other proceedings, if officer, not below the rank of Assistant Commissioner, is of the opinion that there are something wrong or the figures has not been correctly declared or input credit availed is not matched (not with in normal limits) or say finds any discrepancy regarding their figures, may order special GST audit which must be conducted by Chartered Accountant or Cost Accountant as nominated by the officer/department.

The said officer with the approval of commissioner or not below the rank of assistant commissioner issue notice to the registered person in form GST ADT 03 to get his accounts audited by a specified chartered accountant or cost accountant by the department.

The nominated chartered accountant or cost accountant must submit his signed audit report with any material discrepancy found regarding audit of accounts to the Assistant commissioner /specified officer within 90 days in form GST ADT 04. The specified period of 90 days may further be extended for further 90 days, if it is necessary to accomplish his audit report with the request of nominated chartered accountant or cost accountant to Assistant Commissioner.

On completion of special audit, the registered person shall be informed about the findings during special audit.

When the special audit conducted results in detection of unpaid/short paid tax or wrong refund or wrong input tax credit availed, then demand and recovery actions will be initiated.



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