GST NOTICE AFTER AUDIT

Thanks for your question regarding the GST audit and subsequent notice.

You mentioned:

• Your account was audited under Section 65 of the CGST Act, and you received Form ADT-02.

• Now, you're receiving notices under Sections 42 and 43 from the CGST Range Office.

• You want to know:

  1. Do these new notices have legal validity after a full departmental audit?

  2. Is it necessary to respond again or submit ADT-02?

🔍 Let's break this down:

1. Section 65 – Audit by Tax Authorities

• Under Section 65, the department conducts an audit of a registered person.

• Upon completion, the audit findings are shared via Form ADT-02.

• If any discrepancies are found, the taxpayer is generally given a chance to respond or clarify.

2. Sections 42 & 43 – Mismatch Provisions

• Section 42 (Input Tax Credit mismatch) and Section 43 (Output Tax mismatch) deal with matching, reversal, and reclaim of credit.

• These sections, however, have not been operationalized in practice. They are considered "kept in abeyance"by the government and are not enforced currently.

✅ So practically: Notices under Section 42 and 43 are not validly enforceable as of now, since these provisions are not implemented.

🔄 After Audit: Can New Notices Be Issued?

Even after an audit is completed under Section 65, the department is not barred from issuing further notices if they find new discrepancies or non-compliance—but it should be under the appropriate sections like:

• Section 73/74 (for demand and recovery),

• Or Section 61 (scrutiny of returns), etc.

Section 42/43, however, is not applicable at this stage.

📌 What You Should Do

1. Check the notice carefully:

   • If the notice wrongly mentions Sec 42/43, you can respond by saying:

     • These sections are not notified/operational, and

     • Your account has already been audited under Sec 65.

     • Share ADT-02 copy along with your reply.

2. Reply formally:

   • Submit a written response stating that the audit has already been conducted.

   • Attach a copy of ADT-02 and any compliance made after that.

   • Request the officer to withdraw or revise the notice appropriately.

📄 Sample Reply (Short Format):

Subject: Response to Notice under Section 42/43 – GSTIN [Your GSTIN]

Respected Sir/Madam,

This is in reference to the notice issued under Section 42/43 of the CGST Act.
Kindly note that our GST account was audited under Section 65, and the final findings were shared via Form ADT-02 (attached herewith).

We further bring to your kind attention that Sections 42 and 43 have not been notified, and as such, may not be invoked presently.

We request you to kindly consider the audit findings already submitted and close the matter accordingly.

Regards,
[Your Name / Company Name]
[GSTIN]
[Contact Details]