GST audit limitation runs from production of records, and the audit report was found to be within time.

Section 65(4) of the GST Act requires audit to be completed within three months from the date of commencement, which the Explanation ties to the later of when called-for records are made available or when audit begins at the business premises. The court held that the petitioner's communication showed the additional documents were furnished on 09.04.2024, so time ran from that date. On that basis, the audit report dated 08.07.2024 was within the prescribed period, and the limitation challenge failed. The wider question whether the statutory time limit is mandatory or directory was left open.

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Issues: Whether the audit proceedings and consequential show cause notices were liable to be quashed on the ground that the audit report was completed beyond the period prescribed under Section 65(4) of the GST Act.

Analysis: Section 65(4) requires completion of audit within three months from the date of commencement of audit, and the Explanation defines commencement as the later of the date on which the records and documents called for by the tax authorities are made available by the registered person or the actual institution of audit at the place of business. The record did not establish receipt of the documents on 06.05.2024 as claimed by the respondents, but the petitioner's own communication showed that the additional documents called for were made available on 09.04.2024. On that basis, the period of three months was to be counted from 09.04.2024. The final audit report dated 08.07.2024 was therefore within time. The broader question whether the time limit in Section 65 is mandatory or directory was left open.

Conclusion: The challenge based on limitation failed and the audit proceedings were not liable to be quashed.

Final Conclusion: The writ petition was dismissed after holding that the audit was completed within the period prescribed by the statutory definition of commencement.

Ratio Decidendi: Under Section 65(4), read with its Explanation, limitation for completing audit runs from the date the called-for records are made available by the registered person, and if the audit report is filed within three months from that date it is within time.

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