Limitation Period under GST

[Kaustubh Karandikar]

The limitation period under Section 73 is 3 years and under Section 74 it is 5 years. Under this situation, can the GST authorities conduct audit from July’2017? Opinion of the experts please

[Pradeep Reddy Unnathi Partners]

Limitation is to issue SCN in normal cases is 3 years, however it has been extended multiple times vide Supreme Court Suo Moto order on limitation and CGST notifications. Considering the above time limit to complete audit and issue show cause notice is as follows:

FY 17-18- 30.09.2023

FY 18-19- 31.01.2024

FY 19-20- 31.05.2024

Time limit to pass order against such show cause notice are as follows

FY 17-18- 31.12.2023

FY 18-19- 30.04.2024

FY 19-20- 31.08.2024

[Padmanathan KV]

Yes. Audit need not always culminate in 73 or 74. Suppose audit reveals that tax has been collected and not paid, notice under section 76 can also be issued for which there is no time limit specified.

[Sadanand Bulbule]

Dear querist

For the purpose of issue of SCN/adjudication under Section 74, documented evidence of willful fraudulent evasion of tax must be there. Otherwise jurisdiction under Section 74 cannot be invoked just like that.

[KASTURI SETHI]

There is no such restriction in conducting audit from July, 17 now. I also support the views of the experts

[Amit Agrawal]

In the context of query raised and ongoing discussion, following portion of Section 36 of the CGST Act, 2017 is worth noting:

"Every registered person required to keep and maintain books of account or other records in accordance with the provisions of sub-section (1) of section 35 shall retain them until the expiry of seventy-two months from the due date of furnishing of annual return for the year pertaining to such accounts and records:

Provided that ........................."

Due date of filing annual return for FY 17-18 was 5/7th February, 2020 and tax-payers are required to maintain books of account or other records for FY 17-18 in accordance with the provisions of sub-section (1) of section 35 at-least till 5/7th February, 2026. Similar timelines can be worked out for succeeding financial years.

And, I see NO reason to deny Dept. from conducting audit of records of tax-payer u/s 65 till expiry of above-explained time-limits for respective FY.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

AI Summary

Limitation period under GST: extensions permit audits and SCNs within extended timelines; audits can trigger notices without time limit. Limitation under GST distinguishes issuance of show-cause notices from adjudication for willful or fraudulent evasion, with administrative extensions affecting practical deadlines for initiating and completing proceedings for specific past years. Authorities may conduct audits of earlier periods and can issue alternative notices that lack a prescribed time limit. Taxpayers must retain books and records for a statutory retention period measured from the due date of filing the annual return for the relevant year, permitting audit until those retention periods expire.