GST Scrutiny Notice: Criteria on the basis of which your case may be selected for assessment

GST Scrutiny Notice: The Commissioner/Appropriate authority by a general or specific order may select any registered person for audit of his books of accounts for a specific period. on certain parameters as he may deem fit.

Commissioner/ Appropriate Authority may fix the criteria of selection basis this turnover limit while fixing the selection criteria may vary from State to State, in different Zonal levels of a particular State and also for service sector when compared to that for goods.

Certain representative selection criteria that can be considered for risk assessment are given below:-

1. Ratio of Taxable turnover – present year vis-à-vis previous year.

2. Ratio of ITC reversed vis-à-vis Total ITC availed during the year.

3. Ratio of total ITC availed in this year vis-à-vis previous year. Ratio of IGST payment at the time of import vis-à-vis Total

4. ITC availed ({Col.2 of table 4(A) (1) & (2) of GSTR-3B} in corresponding period).

5. Ratio of tax paid through ITC to total tax liability.

6. Ratio of nil/exempt supplies (Col.2 of Table 3.1(C) of GSTR- 3B) to total turnover (excluding non GST supplies ) (col.2 of Table 3.1(a) + (b) + (c) of GSTR-3B).

7. Ratio of Zero-rated supplies (col.2 of Table 3.1(b) of GSTR-3B) to total turnover (excluding non-GST supplies) (col.2 of Table 3.1 (a)+(b) + (c) of (GSTR-3B).

8. Ratio of Non-GST supplies to total turnover. {(Col.2 of Table 3.1(e) / (col.2 of Table 3.1 (a) + (b) +(c) of GSTR-3B)}.

9. Ratio of inward supplies (liable to reverse charge) to total turnover [col.2 of Table 3.1(d)}/Col.2 of 3.1 (a)+(b)+(c) of GSTR-3B)].

10. Ratio of ITC shown in Table 4A(5) of GSTR 3B and ITC as per GSTR-2A.

11. Ratio of tax paid under reverse charge (as per {Col.3+4+5+6 of Table 3.1(d)} to ITC taken on import of services/other reverse charge (other than import of goods) {Col.2+3+4+5 of Table 4A (2+3) of GSTR 3-B}.

12. Ratio of ISD credit {Col.2+3+4+5 of Table 4A (4) of GSTR-3B) to total ITC taken {Col.2+3+4+5 Table 4A of GSTR-3B}.

13. Ratio of ITC reversed {Col.2+3+4+5 of table 4(B) of GSTR 3B} to ITC taken {Col.2+3+4+5 of table 4(A) of GSTR-3B}.

14. Ratio of zero-rated supply to SEZ as per Table 6(B) of GSTR-1 to total GST turnover.

15. Ratio of deemed exports as per Table 6(C) of GSTR-1 to total GST turnover.

16. Turnover declared in Form GSTR-3B vis-à-vis Form GSTR-1.

17. Claim of ITC from cancelled RTPs, aggregate turnover in GST return vis-à-vis Turnover disclosed in Income Tax return.

18. Turnover declared by RTP in Form GSTR-3B compared to turnover on which TDS deducted as reflected in Form GSTR-7 submitted by TDS deductor.

19. Turnover declared by RTP in Form GSTR-3B compared to turnover on which TCS collected as reflected in Form GSTR-8 submitted by TCS collector.

20. Refund claimed against purchase from taxpayer having no auto- population of ITC in Form GSTR-2A.

21. Purchases from non-existent RTPs.

22. RTPs having adverse reports in VAT/Service Tax/Central Excise who are operative in GST etc.)

23. In case, the RTP selected for audit has multiple registrations under the same PAN / TAN in the State, it is suggested that all such registration numbers may be selected for audit.

24. 10% of the selection of the taxpayers may be done on a random basis.

25. Relating to compliance behaviour-based risk (e.g. late filer of return)– RTPs defaulting in filing GSTR-3B for 3 months will be marked 5, those defaulting for 2 months will be marked 3.33 & those defaulting by 1 month will be marked 1.67.

26. Taxpayers claiming ITC of more than the amount from eligible ITC.

27. Taxpayers who have filed all returns and tax adjusted from cash ledger is less than an amount.

28. Taxpayers who have filed all returns and difference in tax liability in GSTR-1 > GSTR-3b by n amount.

29. Composition tax payers having turnover more than 1.25 crore.

30. Newly registered taxpayers with high turnover more than an amount.

31. Newly registered taxpayers with turnover exceeding a pre-decided threshold and cash payout percentage below a certain threshold

32. Taxpayers with (a) multiple use of pan (b) multiple use of email id (c) multiple use of mobile no.

33. Refund amount is greater than the amount.

34. Shipping bill/export proof submitted by taxable person not verified from Ice gate.

35. Turnover declared in GSTR 3b must be compared with TDS/TCS deducted (it should be more than 100 times than TCS deducted and more than 50 times than TDS deducted).

36. Taxable persons dealing in evasion-prone commodities/services as per HSN/SAC code.

37. High spike by n amount in e-way bill value in n months.

38. Ratio of Output Tax paid in cash to the total turnover in the current year is n percentage higher to the ratio of the same in the previous year.

39. Ratio of Output Tax paid to Net Profit in the current year is ―n‖ percent higher to the ratio of the same in the previous year.

40. Taxable Person whose Turnover is less than ―n‖ percentage of turnover from previous year.

41. Ratio of expenses to turnover in the current year is greater than by ―n‖ percent than the ratio of the same in the previous year.

42. Inward supply from bogus dealers.

43. Zero cash set-off against tax liability.

44. Inward supply received but no outward supply.

45. GSTR-1 submitted but GSTR-3B not submitted.

46. Manufactures whose cash set-off is less than 5 per cent.

47. Three or more cases apprehended by mobile squad.

48. Cancellation of E-way bill is more than 2 per cent.