Legal Provision of GST Audit

There are Two impor­tant pro­vi­sions which are rel­e­vant and impor­tant in this con­text are Sec­tion 35(5) and Sec­tion 44(2) of the CGST Act.

In terms of Sec­tion 35(5) of CGST Act “every reg­is­tered per­son whose turnover dur­ing a finan­cial year exceeds the pre­scribed lim­it shall get his accounts audit­ed by a char­tered accoun­tant or a cost accoun­tant and shall sub­mit a copy of the audit­ed annu­al accounts, the rec­on­cil­i­a­tion state­ment under sub-sec­tion (2) of Sec­tion 44 and such oth­er doc­u­ments in such form and man­ner as may be pre­scribed”.

In terms of sec­tion 44(2) of CGST Act “every reg­is­tered per­son who is required to get his accounts audit­ed in accor­dance with the pro­vi­sions of sub-sec­tion (5) of Sec­tion 35 shall fur­nish, elec­tron­i­cal­ly, the annu­al return under sub-sec­tion (1) along with a copy of the audit­ed annu­al accounts and a rec­on­cil­i­a­tion state­ment, rec­on­cil­ing the val­ue of sup­plies declared in the return fur­nished for the finan­cial year with the audit­ed annu­al finan­cial state­ment, and such oth­er par­tic­u­lars as may be pre­scribed”.

In terms of Rule 80(3) of the CGST Rules “every reg­is­tered per­son whose aggre­gate turnover dur­ing a finan­cial year exceeds two crore rupees shall get his accounts audit­ed as spec­i­fied under sub-sec­tion (5) of Sec­tion 35 and he shall fur­nish a copy of the audit­ed annu­al accounts and a rec­on­cil­i­a­tion state­ment, duly cer­ti­fied, in GSTR 9C, elec­tron­i­cal­ly through the com­mon por­tal either direct­ly or through a Facil­i­ta­tion Cen­ter noti­fied by the Com­mis­sion­er

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