All you need to know about the GST Assessment, Demand and Recovery

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GST procedures includes Audits, Assessments, Demand and recovery, Advance ruling. 

GST Audit:
GST Audit involves the scrutiny of the records, statements, returns and various other documents furnished by the registered taxpayer. It is done with the intention to verify the precision of the tax paid, turnover, refund claimed and so on.

What is GST Assessment?
The next step after the audit is GST assessment wherein the verification of the tax liability is done under the CGST Act 2017. The assessment is categorized into five types as follows.

A. Self Assessment
Self – assessment as the name suggests requires the registered taxpayer to do the assessment himself whereas all other assessments are carried out by the tax authorities. In this process, the registered taxpayer assess his tax liability himself and files the returns accordingly for each tax period.

B. Provisional Assessment
It applies when a registered dealer is not able to determine the taxable value of goods or services. In such a case, the taxpayer can request the GST officials for provisional assessment. The officer on acceptance of the request may allow the assessee to file returns and pay tax on a provisional basis at a rate specified by him.

C. Scrutiny Assessment

A GST officer may on his own or if instructed by the authorities, can scrutinize the GST return filed by the taxpayer and related particulars to check the validity and verify its correctness. Also, if the officer found any significant discrepancies in the return, he is allowed to ask for any explanations from the taxpayer that helps him to reach the conclusion. If the explanation is satisfactory, no further action is taken, but if the explanation provided does not seem satisfactory to the officer he may conduct a special audit or may take any appropriate action.

D. Summary Assessment
A summary assessment is applicable when the assessing officer has suitable evidence that the tax liability of a person will adversely affect revenue. In such a case, with the prior approval of the additional or joint commissioner, the assessment officer may issue an assessment order to protect the revenue interest.

E. Best judgments assessment
It is done in the following two situations.

  GST Assessment of non-filers of returns
This assessment is conducted if a registered taxable person fails to furnish his return even after getting a notice under Section 46. It is the duty if the GST officer to carry forward the assessment process to the best of his judgment by taking into account all the relevant material followed by an assessment order within 5 years from the date of furnishing of the annual return for the financial year in which the tax not paid relates. After getting the assessment order, the registered taxpayer will get 30 days to file the valid return after which the assessment order would deem to have withdrawn. However, the person will be liable to pay interest and late fees.
• GST Assessment of unregistered persons
This assessment is done when a taxable person is liable to pay tax but has not obtained a GST registration yet or the registration of the person has been canceled. In such a case, the proper officer to the best of his judgment can assess the tax liability of the person for the relevant tax periods and a show cause notice will be sent to the concerned person. The taxable person will also be given an opportunity of being heard.

Demand and Recovery of GST tax:
The demand and recovery for the tax can be raised by the authorized officer of GST under the following situations:
1) When the tax has been paid incorrectly.
2) No tax has been paid by the assessee.
3) When a taxpayer collects tax but does not deposit the same to the government
4) When CGST or SGST was paid on an IGST applicable supply and vice versa.
5) Incorrect refund or ITC is claimed by the registered dealer.
A show – cause notice will be issued to the taxpayer by the proper officer and if demands are not paid even after the notice, the GST authority can start tax recovery proceedings.


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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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