Excise and Service Tax audit by CERA

[Yatin Bhopi]

Dear expert

We have just received the letter from CERA audit Team for excise and service tax audit for last Three years. They have marked letter to our Excise Jurisdictional office and marked CC to us. From last 7-8 years there was no CERA audit conducted by department

Please go through below link about discussion on the subject matter.

https://www.taxtmi.com/forum/issue?id=107253

Please let me know whether can they do the audit legally?

[Ganeshan Kalyani]

Sir, the experts have discussed at length covering all aspects in the issue id referred by you. Thanks.

[KASTURI SETHI]

Audit will continue legally. Do not be victim of of 'the trap of words'. It is seen often High Court of any State strikes down CE Rules or Service Tax Rules. In spite of that the department continues as per law (Before being struck down) and thereafter, remedial measures are taken retrospectively. So get your audit conducted as usual. You will not get anything by challenging such letters of audit. No confrontation with the department is advised. This is practical advice.

Rest decision is yours.

[Ganeshan Kalyani]

Sir, during one of the audit I involved in, I observed that when assessee takes time in submitting the documents then the Auditor suspects the act of the assessee and as such the auditor insist to produce that document first. Therefore it is better not to create any such image by objecting audit unless out of law. Thanks.

AI Summary

CERA audit continues legally; cooperate with auditors and avoid contesting the notice to prevent escalation.
A departmental CERA audit letter sought excise and service tax records for the prior three years; experts state such audits continue to be legally operative even where rules are challenged. Practical advice is to cooperate, avoid contesting the audit notice, and provide documents promptly since delays can provoke auditor suspicion and escalation.