During GST Audit the Proper Officer may initiate action under Section 73 or 74 of the CGST Act

Last updated: 12 February 2024

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The Madras High Court has ruled that a Proper Officer can initiate action under Section 73 or 74 of the CGST Act following a GST audit, even if the audit report doesn't explicitly state fraud. If the audit reveals unpaid or short-paid tax, or incorrect Input Tax Credit (ITC) usage, the officer has the discretion to proceed with these actions. This decision clarifies the scope of Section 65(7) of the CGST Act regarding post-audit proceedings.

Court :
Madras High Court

Brief :
The Hon'ble Madras High Court in the case of M/s. ABT Ltd. v. The Additional Commissioner of GST and Central Excise [Writ Petition No. 1756 of 2024 dated January 30, 2024] dismissed the writ petition and held that during the conduct of GST Audit under Section 65 of the Central Goods and Services Tax Act, 2017 ("the CGST Act"), if it indicates that tax was not paid or short paid or that Input Tax Credit ("ITC") was wrongly availed or utilized, the proper officer may initiate the action under Section 73 or 74 of the CGST Act underSection 65(7) of the CGST Act.

Citation :
Writ Petition No. 1756 of 2024 dated January 30, 2024

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Judgement posted by

Bimal Jain

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FCA, FCS LLB with21 Yrs of Experience inTaxation Indirect and Direct: Education Qualification: B.Com (Hons) Chartered Accountants Company Secretary LLB Qualified SAP FI/CO Consultants Professional Membership: Chairmanof Indirect Tax Committee of PHD Chamber of Commerce Member of Indirec ... Read more

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