Audit under EA-2000

[Hasmukh Patel]

Dear Sir,

We have received letter for Audit of our one firm under audit scheme EA 2000.Audit for old period (before GST). Can they conduct Audit under Section 174 (2) (e) ????

As per my knowledge by CGST section 173 & 174 old section 94 of schedule was omitted for old audit.

[KASTURI SETHI]

The letter received by you has been issued after getting permission from the competent authority i.e. duly authorised by the Commissioner. It is a practice that permission is obtained in the file. No need to be mentioned in the letter issued for audit. It is advance intimation to the assessee.

Section 174 is a saving Section and sub-section 2(e) of 174 does not bar the department. The repeal and amendment will not

(e) affect any investigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and any other legal proceedings or recovery of arrears or remedy in respect of any such duty, tax, surcharge, penalty, fine, interest, right, privilege, obligation, liability, forfeiture or punishment, as aforesaid, and any such investigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and other legal proceedings or recovery of arrears or remedy may be instituted, continued or enforced, and any such tax, surcharge, penalty, fine, interest, forfeiture or punishment may be levied or imposed as if these Acts had not been so amended or repealed.

[Rajagopalan Ranganathan]

Sir,

As per Section 174 (2) (e) of CGST Act, 2017 " the repeal of the said Acts and the amendment of the Finance Act, 1994 (32 of 1994) (hereafter referred to as “such amendment” or “amended Act”, as the case may be) to the extent mentioned in the sub-section (1) or section 173 shall not affect any investigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and any other legal proceedings or recovery of arrears or remedy in respect of any such duty, tax, surcharge, penalty, fine, interest, right, privilege, obligation, liability, forfeiture or punishment, as aforesaid, and any such investigation, inquiry, verification (including scrutiny and audit), assessment proceedings, adjudication and other legal proceedings or recovery of arrears or remedy may be instituted, continued or enforced, and any such tax, surcharge, penalty, fine, interest, forfeiture or punishment may be levied or imposed as if these Acts had not been so amended or repealed.

Therefore the Department is empowered to conduct Audit under repealed Act even after 1.7.2017.

"Said Acts" means the Central Excise Act, 1944 (1 of 1944) (except as respects goods included in entry 84 of the Union List of the Seventh Schedule to the Constitution), the Medicinal and Toilet Preparations (Excise Duties) Act, 1955 (16 of 1955), the Additional Duties of Excise (Goods of Special Importance) Act, 1957 (58 of 1957), the Additional Duties of Excise (Textiles and Textile Articles) Act, 1978 (40 of 1978), and the Central Excise Tariff Act, 1985 (5 of 1986).

[Hasmukh Patel]

Thanks a lot for clarification.....

AI Summary

Section 174(2)(e) of CGST Act allows audits for periods before GST, confirming ongoing authority despite law changes. A query was raised regarding the authority to conduct an audit under the EA-2000 scheme for a period before the implementation of GST. The question concerned whether Section 174(2)(e) of the CGST Act allows such audits. Responses clarified that Section 174 is a saving clause that permits ongoing investigations, inquiries, and audits even after the repeal of previous acts. The department can conduct audits for periods before GST implementation as these legal proceedings remain unaffected by the repeal or amendment of earlier laws. The discussion concluded with gratitude for the clarification provided.