Chapter 13

Section 65 – Audit by Tax Authorities

• Authority: Commissioner or authorized officer.
• Scope: Audit can cover any registered person, period, and frequency as prescribed.
• Location: Audit can be at the business premises or officer’s office.
• Notice: Minimum 15 working days prior notice required.
• Timeframe:
  • Standard: 3 months from commencement.
  • Extension: Up to 6 additional months if justified.
• Powers during audit:
  • Inspect books and documents.
  • Require information and assistance.
• Post-audit: Findings communicated within 30 days.
• Non-compliance: If tax is unpaid or ITC wrongly claimed, action under Section 73 or 74.

Section 66 – Special Audit

• Applicability: When value is misdeclared or ITC is unusual; requires Assistant Commissioner’s recommendation and Commissioner’s approval.
• Conducted by: Chartered Accountant or Cost Accountant nominated by the Commissioner.
• Timeframe: 90 days, extendable by another 90 days.
• Rights of taxpayer:
  • Opportunity to be heard on audit findings.
• Costs: Paid by Commissioner.
• Non-compliance: Same as Section 65, action under Section 73 or 74.