Directorate General of Audit Indirect Taxes vide F. No. 381/49/2019 dated June 25, 2019, has released strategy pertaining to the audit of GST Taxpayers commence from July 1, 2019, in respect of those taxpayers who have filed their Annual Return in GSTR Form 9 / 9A. However, in the recent GST Council Meeting held on June 21, 2019, the last date of filing of the Annual Return has been extended by two months, i.e. up to August 31, 2019.
This Directorate General in association with DGARM has developed a Risk Assessment programme, wherein list of taxpayers with risk scores will be generated and made available to each Audit Commissionerate through DDM Portal. The said list of taxpayers is in three categories based on the annual turnover are Large, Medium (taxpayers with turnover between Rs.10/7.5 to 40/30 crores) and Small (taxpayers with turnover below Rs. 7.5/10 crores) along with their Risk Scores has been made available to the field formations by DGARM.
The said list contains only those taxpayers who are under Centre administration and have filed more than 3 GSTR 3B returns in the said 9 months period. However, for some Audit Commissionerate, the categories have been suitably tweaked to ensure adequate representation of risky taxpayers in each category.
Further, the Audit Commissioners are required to check all other aspects as well which are found necessary at their local level. The decision support as provided with the list for each registered Taxpayer is based on the risk analysis undertaken on defined parameters the data for which was available. However, the audit teams have to be advised by the concerned Audit Commissionerate to verify all aspects to ensure that all issues are duly examined having revenue implication.
This Directorate General has worked out the approximate number of audits in each category that can be conducted by each Audit Commissionerates. This calculation is based on the number of audit parties available and the working strength of officers as provided by the Audit Commissionerates.
It is also advised that initially only those taxpayers should be selected for audit who have filed their Annual Return in GSTR Form 9/9A. If a sufficient number of taxpayers who have filed annual return are not available then Audit Commissionerates should continue conducting legacy audits under Central Excise and Service Tax, up to August 31, 2019, in case assessees are available for such audits and also efforts should be made to liquidate the pendency related to audits of erstwhile Central Excise and Service Tax including action to close the pending audit paras.
The GST Audit Manual 2019, prepared by this Directorate General will be shared separately on ANTARANG. However, it is mentioned that the audit process in GST is similar to the audit process in the erstwhile Central Excise and Service Tax Audit Manual, 2015.
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