Types of GST Audit under CGST Act, 2017

Normal Audit u/s 35(5)

• According to section 35(5) of CGST Act 2017, every registered person whose turnover during a financial year exceeds the prescribed limit i.e. 2cr. shall get his accounts audited by a chartered accountant or cost accountant and he is required to submit a copy of audited annual accounts, the reconciliation statement under sub section (2) of section 44 (GSTR-9C) and such other documents in such form and manner as may be prescribed.
• Nothing contained above shall apply to any department of Central Government or a State Government or a local authority, whose books of accounts are subject to audited by Comptroller and Auditor General of India or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force.

Audit by tax authorities u/s 65

• According to section 65 of CGST Act 2017, The Commissioner or any officer authorized by him, by way of general or specific order, may undertake audit of any registered person for such period, at such frequency and in such manner as may be prescribed.
• The registered person shall be informed by way of notice within 15 working days prior and audit shall be completed within the period of three months from the date of commencement. If the commissioner is satisfied that audit cannot be completed within 30 days then he may extend the period by further extending the period not more than 6 months. The proper officer shall inform the registered person about the findings, his rights and obligations, within 30 days of the conclusion of audit.

Special Audit u/s 66

• According to section 66 of CGST Act 2017, if at any stage of scrutiny, inquiry, investigation or any other proceedings before him, any officer not below the rank of Assistant Commissioner, having regard to the complexity of the case, with the prior approval of the Commissioner, direct such registered person to get his records including books of accounts audited by chartered accountant or cost accountant as may be nominated by the Commissioner.
• The nominated chartered accountant or cost accountant shall submit his audit report within the period of 90 days to said Assistant Commissioner.

If the  Assistant Commissioner is satisfied for any material and sufficient reason made to him by chartered accountant or cost accountant then he may further extend the period for 90 days.

• The expenses of the examination and audit of records, including the remuneration of chartered accountant or cost accountant shall be determined and paid by the commissioner.
• The registered person shall be given an opportunity of being heard in respect of any material gathered on the basis of special audit.