It is an age-old practice to avail of the services provided by experts and a due process of law. One such potential has been extended with Special Audit under section 66 by the CGST Act, 2017, enabling an officer not below the rank of an Assistant Commissioner, if duly approved, to obtain the services of a Chartered Accountant or Cost Accountant for the purpose of conducting a detailed examination of a registered person's operations. Such types of provisions also exist under the Income Tax Law as well.
Also, read; Offences by Companies under Section 137 of CGST Act, 2017
Special Audit - Section 66:
- Any officer, not being below the rank of an Assistant Commissioner, if at any point of Scrutiny, Inquiry, Investigation or any other Proceedings before him, is of the opinion that the value has not been accurately declared or the credit that has been availed is not within the specific limits, then he may regard the registered person via a communication sent to him with prior approval of the commissioner to get his record inclusive of Books of Accounts audited and thoroughly examined by a chartered accountant or a cost accountant as may be nominated by the commissioner.
- Within a period of 90 days, the chartered accountant or cost accountant as may be nominated by the commissioner shall submit a duly signed & certified Audit to the assistant commissioner with an addition of any other particulars as may be specified.
- However, the assistant commissioner may extend the aforementioned period by 90 days more based on any material and sufficient reason or an application sent to him in the regard of the same by a registered person or chartered accountant or cost accountant.
- Under subsection (1), the registered person's accounts shall be subject to the provisions of this Act regardless of whether the accountants have reviewed the accounts in accordance with any other law at the time.
- In any proceedings against a registered person under this Act or the rules made thereunder, materials gathered on the basis of a special audit should be provided to the registered person for his or her consideration.
- The Commissioner shall determine and pay the expenses of examination and audit of records under sub-section (1), including the remuneration of the chartered accountant or cost accountant.
In the event that the special audit conducted under sub-section (1) reveals that taxes have not been paid or have been short-paid or erroneously refunded, or input tax credits have been wrongly claimed or utilized, the proper officer may initiate action under section 73 or section 74.
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