GST Audit & Investigation

GST audit and investigation are governed primarily by Sections 65, 66, and 67 of the CGST Act, 2017, together with Rule 101 (departmental audit) and Rule 102 (special audit) of the CGST Rules, 2017.

Departmental Audit (Section 65, Rule 101): The Commissioner, or an officer authorised by him, may undertake an audit of any registered person's records, returns, and other documents to verify correctness of declared turnover, taxes paid, refunds claimed, and input tax credit availed. The registered person must be given at least fifteen working days' advance notice in FORM GST ADT-01. The audit must ordinarily be completed within three months of commencement, extendable by the Commissioner for a further period not exceeding six months, for reasons recorded in writing. On conclusion, the findings, along with the registered person's rights and obligations, are communicated in FORM GST ADT-02 within thirty days. Where the audit discloses tax short-paid, unpaid, or input tax credit wrongly availed or utilised, the proper officer initiates proceedings under Section 73 (non-fraud cases), Section 74 (fraud, wilful misstatement, or suppression cases), or Section 74A (for tax periods from FY 2024-25 onward, per the Finance Act, 2024).

Special Audit (Section 66, Rule 102): At any stage of scrutiny, inquiry, investigation, or other proceedings, an officer not below the rank of Assistant Commissioner who forms the opinion — having regard to the complexity of the case and the interest of revenue — that declared value is incorrect or credit availed is not within normal limits, may, with the Commissioner's prior approval, direct the registered person in FORM GST ADT-03 to have records audited by a chartered accountant or cost accountant nominated by the Commissioner. The nominated auditor must submit the report within ninety days, extendable by a further ninety days on the registered person's application or the auditor's own request.

Inspection, Search, and Seizure (Section 67): Empowers an officer not below the rank of Joint Commissioner, on "reasons to believe" that a taxable person has evaded or is evading tax, to authorise inspection of a place of business, and search and seizure of goods, documents, books, or things liable to confiscation. Findings from Section 67 action likewise feed into demand proceedings under Section 73, 74, or 74A.

GST audit and investigation support is the representation of a business when the GST department examines its affairs — the audit under Section 65 of the CGST Act 2017, the special audit under Section 66, the inspection, search and seizure powers of Section 67, the summons of Section 70, and the demand proceedings of Sections 73 and 74. The department's examination is a process with its own rules and its own pace, and the business's response is a professional discipline: what is produced, how it is produced, what is said and when.

The audit and investigation is where the GST position is tested under pressure. The officers examine the returns, the books, the credits and the transactions; they can summon the personnel under Section 70; and where the findings point to evasion, the matter moves to the demand and penalty machinery. The business that has prepared its records and understands its positions navigates the process; the one that improvises under pressure makes the process worse.

The cost of a mishandled investigation is the escalation of the finding: a demand computed on incomplete records, an admission made without the analysis, a penalty that the facts did not warrant. The professional representation is what keeps the examination within its proper scope and the findings within their proper size.

This service is for businesses under GST audit or investigation. We prepare the response to the audit under Sections 65 and 66, manage the production of records, support the personnel through the Section 70 summons, handle the demand proceedings under Sections 73 and 74, and negotiate the assessment to a fair order.