As per section 35(5) of the GST Act, 2017 read with rule 80(3) of the GST Rules, 2017, every registered taxable person aggregate turnover during a financial year exceeds two crore rupees shall get his accounts audited by a chartered accountant or a cost accountant and shall submit to the proper officer a copy of the audited statement of accounts, the reconciliation statement as required to be filed along with annual return under section 44(2) and such other documents in the form and manner as may be prescribed in this behalf.

Accordingly, every registered taxable person whose turnover during a financial year exceeds two crore rupees, should:

(a)   get his accounts audited,

(b)  get audit conducted by a chartered accountant or a cost accountant,

(c)   submit to the proper officer, a copy of:

(i)   the audited statement of accounts,

(ii)  the reconciliation statement under section 44(2),

(iii) other prescribed documents in prescribed form and manner.

An assessee is required to submit the required statements/reports in an electronic form. As per section 44(2) of the GST Act, 2017, every taxable person who is required to get his accounts audited under section 35(5) shall furnish, electronically, the annual return along with the audited copy of the annual accounts and a reconciliation statement, reconciling the value of supplies declared in the return furnished for the year with the audited annual financial statement and other prescribed particulars in FORM GSTR-9C electronically through the common portal either directly or through a Facilitation Centre notified by the Commissioner.

This requirement is applicable only on those cases where assessee is also required to get his accounts audited under section 35(5).

Meaning of Chartered Accountant / Cost Accountant

As per section 2(23) of the GST Act, 2017 means a chartered accountant within the meaning of the Chartered Accountants Act, 1949.As per section 2(1) (b) of Chartered Accountants Act, 1949, ‘chartered accountant’ means a person who is a member of the Institute of Chartered Accountant of India (ICAI).

As per section 2(35) of the GST Act, 2017 means a cost accountant within the meaning of the Cost and Works Accountants Act, 1959). As per section 2(1)(b) of Cost and Works Accountants Act, 1959, ‘cost accountant’ means a person who is a member of the Institute of Cost and Works Accountants of India (ICAI).

Records to be maintained by owner or operator of godown / warehouse / transporters

Every person engaged in the business of transporting goods shall maintain records of goods transported, delivered and goods stored in transit by him and for each of his branches.

Every owner or operator of a warehouse or godown shall maintain books of accounts, with respect to the period for which particular goods remain in the warehouse, including the particulars relating to dispatch, movement, receipt, and disposal of such goods.

The goods shall be stored in such manner that they can be identified item wise and owner wise and shall facilitate any physical verification or inspection, if required at any time.

Records to be maintained by an Agent

As per rule 56(11) of the GST Rules, 2017, every agent referred to in clause (5) of section 2 shall maintain the following accounts:

(a)   particulars of authorization received by him from each principal to receive or supply goods or services on behalf of such principal separately;

(b)  particulars including description, value and quantity (wherever applicable) of goods or services received on behalf of every principal;

(c)   particulars including description, value and quantity (wherever applicable) of goods or services supplied on behalf of every principal;

(d)  details of accounts furnished to every principal; and

(e)   tax paid on receipts or on supply of goods or services effected on behalf of every principal.

Separate accounts in relation to works contracts

As per rule 35(14) of the GST Rules, 2017, every registered person executing works contract shall keep separate accounts for works contract showing –

(a)   the names and addresses of the persons on whose behalf the works contract is executed;

(b)  description, value and quantity (wherever applicable) of goods or services received for the execution of works contract;

(c)   description, value and quantity (wherever applicable) of goods or services utilized in the execution of works contract;

(d)  the details of payment received in respect of each works contract; and

(e)   the names and addresses of suppliers from whom he received goods or services.

Accounts and records by clearing & forwarding agent

As per rule 56(17) of the GST Rules, 2017, any person having custody over the goods in the capacity of a carrier or a clearing and forwarding agent for delivery or dispatch thereof to a recipient on behalf of any registered person shall maintain true and correct records in respect of such goods handled by him on behalf of such registered person and shall produce the details thereof as and when required by the proper officer.

Time limit for retention of books of account / other records

As per section 36(1) of the GST Act, 2017, every registered taxable person who is required to keep and maintain books of account or other records shall retain them until the expiry of seventy-two months (6 years) from the last date of filing of annual return for the year pertaining to such accounts and records.

Accordingly, every assessee shall retain the prescribed books of accounts and other prescribed records until the expiry of seventy-two months (6 years) from the last date (not the actual date of filing, based on strict interpretation) of filing of annual return for the year pertaining to such accounts and records.

It may be noted that annual return under section 44 of the GST Act, 2017 is required to be filed on or before 31st December following the end of financial year.

Where the taxable person has more than one place of business, as evidenced by the certificate of registration, in such cases, accounts and records should be retained for a period of 6 years in terms of section 36(1) for each such place of business.

According to proviso to section 36(1) of the GST Act, 2017, a taxable person, who is a party to an appeal or revision or any other proceeding before any appellate authority or tribunal or court, whether filed by him or by the department, shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceeding for a period of one year after final disposal of such appeal or revision or proceeding, or for the period specified under sub-section (1), whichever is later.

Accordingly, where a taxable person-

     is a party to an appeal or revision or any other proceeding before any appellate authority or tribunal or court, and

     whether such appeal etc is filed by him or by the department, such taxable person shall retain the books of account and other records pertaining to the subject matter of such appeal or revision or proceeding

     for a period of one year after final disposal of such appeal or revision or proceeding, as the case may be, or

     for the period specified under sub-section (1), ie six years,

whichever is later. This requirement is for keeping accounts and records having a bearing on or subject matter of such proceedings etc.