As per Section 35(5) of the CGST Act,2017 read with Rule 80(3) of the CGST Rules, 2017 every registered person whose turnover during a financial year exceeds Rs 2 Crore is required to get GST Audit done and furnish GSTR-9C.
However vide Notification No. 16/2020-Central Tax dated 23.03.2020 following proviso was inserted to Rule 80(3) of the CGST Rules, 2017.
Provided that every registered person whose aggregate turnover during the financial year 2018-2019 exceeds five crore rupees shall get his accounts audited as specified under subsection (5) of section 35 and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in FORM GSTR-9C for the financial year 2018- 2019, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.
Accordingly as per above proviso relief was provided whereby tax payers having aggregate turnover exceeding Rs 5 crore were only required to get the audit done instead of normal limit of Rs 2 Crore. However this relief was provided only for FY 2018-19.
GST Audit relaxation / Relief extended till FY 2019-20:
The Central Government vide Notification No. 79/2020–Central Tax dated 15-10-2020 has made certain amendments to CGST Rules, 2017 out of which one of the amendment is in proviso to Rule 80(3) of the CGST Rules,2017.
As per the amendment, the existing proviso is substituted by the following:
“Provided that for the financial year 2018-2019 and 2019-2020, every registered person whose aggregate turnover exceeds five crore rupees shall get his accounts audited as specified under sub-section (5) of section 35 and he shall furnish a copy of audited annual accounts and a reconciliation statement, duly certified, in FORM GSTR-9C for the said financial year, electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.”.
Thus from above substitution of proviso to Rule 80(3), the tax payers with turnover upto Rs 5 crore will continue to be exempt from requirement of GST Audit under Section 35(5) of the CGST Act,2017 and thus the GST Audit relaxation for them will continue for FY 2019-20 as well.
For ready reference of our readers the relevant extract of the Notification is given below:
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Frah Saeed is a law graduate specializing in the core field of indirect taxes and is the Co-founder of taxwallah.com. She has authored many publications on GST and is into full-time consultancy on GST to big corporates. She as a part of taxwallah.com heads a team comprising of Chartered Accountants and Advocates and plays a key role in our mission to disseminate GST knowledge to all.
