What is GST filing audit process and its procedure ?

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GST filing audit process requires scrutiny of books and accounts of the individual who is registered to pay tax. The examination is done to ensure the validity of the information given, refund claims, input tax credit availed and tax liability. An individual whose turnover during the financial year is more than 2 crores needs to hire the chartered accountant for auditing the accounts. One can also hire the Cost Management Accountant for auditing the process.

Under section 35(5), a taxable person who has to get his accounts audited should offer the Annual return electronically in addition to the copy of an audited statement along with the reconciliation statement. The reconciliation statement should have the reconciling the values of the supplies mentioned in the return furnished for the financial year with the audited annual financial statement. A taxable individual should also present the audited annual financial statement, certified audited annual accounts in Form GSTR-9C with annual return. The process is conducted by the commissioner or any individual authorized by the commissioner. There are few terms that an individual doing audit should take care of.
• A notice should be given 15 days before conducting the audit
• It is mandatory to complete the audit within 3 months from the date of starting the audit.
• However, it is in the authority of the commissioner of CGST/SGST to increase the time limit more than six months.

Procedure of GST Audit
Those having the authority to audit the books on the registered Individual should verify all the documents, books maintained, statements and returns furnished as per the act. It is the duty of the audit officer to verify the accuracy of the statement and information provided in line with the act. Officer and his team should check the precision of the tax rate levied on the supply of goods and services, deductions claimed, and exemptions given, refunds claimed, and the input tax credit availed among other things.
It is also the duty of the auditee to furnish all the information, documents and statements as and when demanded by the auditor. The officer in charge might ask for other related documents if required and the auditee should support in that. In case the auditing officer comes across any issues or discrepancies in the documents and filings, he would inform the same to the registered individual. The registered taxpayer will then have to file his reply and the officer would then proceed with the audit after considering the response of the auditee.

Finalizing the Audit
The officer in charge should conclude the GST filing audit after examining the reply of the registered taxpayer and thereafter audit the findings occurred during the course of the audit. The authorized officer should inform the registered person about the observation and the reasons of these findings along with the rights and obligations. If the proper officer finds any issues related to the unpaid due or wrong refunds due, it would require the demand and recovery actions.

Difference between GST filing Audit under Section 65 and Section 66


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An MBA in finance, I like to cover the wide range of topics related to Taxation, SEBI, Finance and anything that is Public Helpful. The motive is always to make it simpler for the taxpayers understand the system better and take informed decisions.

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