AUDIT BY COMMISSIONER
1.1 Circumstances where audit is mandatory
The Commissioner may arrange for audit of the business of such registered dealers who are selected by him based on the following grounds:-
- application of any criterion or
- random selection basis or
- in respect of whom the Commissioner has reasons to believe that detail scrutiny of their business is necessary.
FAQ on website of Department
Question
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What is audit?
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Answer
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In view of the incorporation of self-assessment procedures and for promoting compliance, the concept of audit has been introduced in the Act. Based on certain pre decided criteria as well as random selection, cases will be selected for audit.
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1.2 Role of Auditor
The auditor while conducting audit shall exercise the powers provided under section 75 and shall examine the following documents:-
- books of accounts,
- stock in trade and
- related documents of the dealer of the audit period.
Power of Auditors as per section 75(For detailed powers refer Annexure 1)
An assessing authority or any officer not below the rank of Junior Commercial Taxes Officer authorised by the Commissioner in this behalf with such conditions and restrictions as may be specified by the Commissioner, shall have the power-
- to inspect or survey the place of business of a dealer or any other place where it is believed by such authority or officer that business is being done or accounts are being kept by such dealer;
- to direct such dealer to produce accounts, registers and documents relating to his business activities for examination;
- to inspect the goods in the possession of the dealer or in the possession of anybody else on behalf of such dealer, wherever such goods are placed;
- to make search of such place including the search of the person found there, where concealment of facts relating to business is suspected;
- to break open the door of any premises or to break open any almirah, box, receptacle in which any goods, accounts, registers or documents of the dealer are suspected to be concealed, where access to such premises, almirah, box or receptacle is denied;
- to record the statement of the dealer or his manager, agent or servant or to take extracts from any record and to put identification marks on accounts, registers or documents and on any door, almirah, box or receptacle.
1.3 Who can be the auditor?
Auditor can be any officer not below the rank of Assistant Commercial Taxes Officer authorized as such by the Commissioner.
1.4 Jurisdiction of Auditors
The Assistant Commissioner or the Commercial Taxes Officer or the Assistant Commercial Taxes Officer shall be the auditor for such area or for such dealer or class of dealers as may be determined by the Commissioner.
1.5 Discrepancies in return
If during the period of audit, the returns filed by the dealer are not found to be correct, or any avoidance or evasion of tax is detected the auditor shall issue a show cause notice to the dealer containing details of discrepancies detected.
1.6 Show Cause Notice
- If Reply to Show Cause Notice is made by the dealer
After the receipt of the reply to notice issued under section 27(4), the auditor shall after considering the reply of the dealer assess his tax and other related liabilities and get such order approved from his immediate higher officer before its issuance to the dealer along with the demand notice.
- If no reply is made by the dealer
Where the dealer fails to submit the reply to notice issued under section 27(4), the auditor shall proceed to assess the liability of the dealer under RGST Act, to the best of his judgment. Such assessment shall be deemed to be the assessment, of the dealer for the relevant period and assessment if any, already made shall be subject to the assessment made under section 27.
1.7 No action without opportunity of hearing
Where an assessing authority or any other officer passes an order against dealer in respect of following reasons:
- enhancement of the admitted tax liability of a dealer, or
- imposes a penalty on him or on any other person under the provisions of the Act or the Rules, or
- passes any order detrimental to the interest of the dealer,
the said authority or officer shall record the reasons thereof, and no such order shall be passed unless the dealer or the person has been given a reasonable opportunity of being heard.
1.8 Notice in form GST-14 to be issued
Following are the reasons for which notice in Form GST-14 shall be issued:
- for affording opportunity of being heard under rule 48;
- for initiating any action under any provisions of the Act or the Rules;
- for the production of a document;
- for furnishing any information; or
- for the appearance of any person.
SAMPLE FORM
Form GST- 14
Notice
1. Name of the Dealer/Person TONY SINGH
2. Registration No.(TIN) (if any) xxxxxxxxxxxxxx
3. Address of principal place of business
Building No/ Name/ Area Flat no. 31
Area/ Road Zafar Marg
Locality/ Market Zafar Bazar
Pin Code 11xxxxx
Email Id zafar@gmail.com
Telephone Number(s) 2222222222
Fax Number(s) 2122222222
4. (A) You are directed to submit:
(1) The return related to the period April, 20xx to March 20xx in FormGST10/GST11
(2) The trading account for the period April, 20xx to March 20xx.
(3) Books of accounts for the period from April, 20xx to March 20xx.
(4) The Declaration forms in the support of sales made during the period from April, 20xx to March 20xx.
(5) The proof of deposit of Tax for the period from April, 20xx to March 20xx.
(6) Audit report as required under section 73 of the Act read with rules 36 (6) of Rules
(7) Copy of Form GST 07, GST 09, GST 12, GST 48, GST 50 proof of export sales, account of declaration forms for the period from April, 20xx to March 20xx.
(9) Details of Tax deducted for the period from April, 20xx to March 20xx
So as to reach the office of the undersigned on or before 20 April, 20yy.
(B) Whereas, your personal attendance is required to adduce evidence under the Act regarding_________________________.
(Mention the subject matter in brief), you are hereby summoned to appear in person before me on 30 April, 20xx At 1:00p.m. Hours, in the office of undersigned and not to depart hence until permitted by me.
Please take notice that failure to furnish the above required information / documents or non appearance, without sufficient cause, will render you liable to penalty under Section 64 of the Rajasthan GST Act, 2003.
Given under my hand and seal, this _______ Day of ________, 20____
Signature Sd/-
Name RAJAT AGGARWAL
Designation Goods and Service tax officer
Place _____, Rajasthan
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1.9 Mode of service of summons, notice etc.
The service of any summons, notice or order shall be affected in any one of the following ways, namely:
- by giving or tendering the copy thereof to the person addressed or his declared business manager or his authorized representative or to any person, other than an independent service provider, who submits or files documents on behalf of such person or dealer; or
- if the persons mentioned in point (a) can not be easily found, by giving or tendering a copy thereof to an adult member of his family; or
- if the address of such person is known to the authority concerned, by sending a copy thereof by registered post or through an electronic device, or
- if none of the modes aforesaid is practicable, by affixation of a copy thereof in some conspicuous place at his last known place of business or residence, or by publishing in a State level newspaper.
Exception: Sending summons, notice etc. by E-mail
However, service of any summons, notice or order may be effected by sending the contents of such summons, notice or order as the case may be, to the dealer or to his declared business manager or to his authorized representative, through an e-mail address provided by the dealer or the person, and such service shall be deemed to be a valid service on such dealer or person.
1.10 Place of Audit
The audit of a dealer shall generally be conducted by the auditor at the place of the business of the dealer with prior intimation to such dealer.
However, Commissioner, in appropriate cases, may direct such audit to be conducted in the office of the auditor.
The audit shall be conducted as far as possible on a day-to-day basis.
1.11 Preparation and submission of audit report
After the completion of the audit, the auditor shall prepare an audit report mentioning therein the discrepancies found at the time of audit.
Also, the audit report shall be signed by the dealer or his business manager or his authorized signatory and in case of their refusal the auditor shall make a remark to this effect.
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