GST audit to be discontinued and won’t be held by the Central Council for Indirect Taxation and Customs (CBIC) w.e.f. 1st August 2021. Throughout the execution of the authorities given in Article (b) of sub-section (2) of Section 1 of the Finance Act, 2021 (13 of 2021), the Central Government hereby determines the date on which Articles 110 and 111 of this Act enter into force, as notified by the CBIC. As a result, taxpayers having GST registration will no longer need to have their yearly accounts audited by a CA/CMA or submit an audited reconciliation statement on Form GSTR-9C beginning from 1st August 2021.
GST Audit To Be Discontinued
The Finance Act 2021 recommended that the necessity to have an audit of a chartered accountant or cost accountant’s annual financial statements be removed and the audit of the reconciliation statement in GSTR-9C form be removed by the provisions of Article 35 (5) of the CGST Act and substituted for Article 44 of the CGST Act. Now the GSTR-9 annual report is to be issued with a conciliation declaration on a self-certified approach.
Further Information by CBIC
The experts have nevertheless taken a seat back with the government proposing budgets to abolish the CA/CMA GST audits. To evaluate the interim relief provided by the government from GST audits, CMA/CA can only take interim relief to discontinue GST audits. Because other GST audits remain unbroken, like departmental officers’ audits or special audits.
Furthermore, a provision was introduced to provide that, upon receipt of the GST Board recommendations, the Commissioner may exclude any category of citizens from submitting annual returns.
Consequently, in the first occurrence, administrative officers would identify short/no-payment of the GST return filing, which would call for heavy sanctions. Now the evaluations are at the mercy of the administrative officials alone, and in most situations, section 73 or 74 can be used as the central level of controls, which has been eliminated through expert audits, to impose penalties.
Under Section 73, the determination or misuse, for any purpose other than theft, of the tax not given or short paid or mistakenly returned or input tax credit.
Under Section 74, the determination of a tax which is not given or short paid or mistakenly reimbursed or an input tax credit misused due to fraud or intentional abuse or deletion.
In consideration of the rigorous provisions of the GST return filing, however, as part of the internal GST audit, it is recommended for enterprises to conduct GST audits.
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