Accounts and Records in GST by Registered person [section 35(1) or (3) or (4) or (6)] - GST Ready Reckoner - GST

Accounts and Records in GST by Registered person Introduction Assessment in GST is mainly focused on self-assessment by the taxpayers themselves. Every taxpayer is required to self-assess the taxes payable and furnish a return for specified tax periods i.e. the period for which return is required to be filed. The compliance verification is done by the department through scrutiny of returns, audit and/or investigation. Thus, the compliance verification is to be done through documentary checks rather than physical controls. This requires certain obligations to be cast on the taxpayer for keeping and maintaining accounts and records. Category of person required to maintain the books of account and which place of maintenance of such books of account [ section 35(1) read with rule 56 (7) (10) ] Section 35(1) of the CGST Act, 2017 provides that every registered person shall keep and maintain, at his principal place of business, as mentioned in the certificate of registration. The transporters, warehouse keepers are required to maintain records of consigner, consignee or any relevant details even if they are not registered in GST. They need to enrol for the purpose. Place wise books for additional places where more than one place of business is specified in the certificate of registration, the accounts relating to each place of business shall be kept at such place of business. If any documents, registers, or any books of account belonging to a registered person are found at any premises other than those mentioned in the certificate of registration, they shall be presumed to be maintained by the said registered person . [ Rule 5610 of CGST Rules ] Which type of Accounts and records are required to be maintained [Section 35(1) read with rule 56 (1),(3),(5), (6) ] It is important to note the record stated below shall be maintained by composition taxpayer as well as normal taxpayer under section 9 of CGST act. Section 35(1) of the CGST Act, 2017 provides a true and correct account of following to be maintained by the every registered person a) production or manufacture of goods; b) inward and outward supply of goods or services or both; c) stock of goods; d) input tax credit availed; e) output tax payable and paid; and f) such other particulars as may be prescribed under rule 56(1) Every registered person shall keep and maintain, in addition to the particulars mentioned in section 35(1), a true and correct account of (a) the goods or services imported or exported or (b) supplies attracting payment of tax on reverse charge along with the relevant documents, including invoices, bills of supply, delivery challans, credit notes, debit notes, receipt vouchers, payment vouchers and refund vouchers. [Rule 56(1)] Records of advance [Rule 56(3)] Every registered person shall keep and maintained a separate account of advances received, advance paid and adjustments made thereto. Particulars of the persons [ Rule 56(5)] Every registered person shall keep the particulars of - (a) names and complete addresses of suppliers from whom he has received the goods or services chargeable to tax under the Act; (b) names and complete addresses of the persons to whom he has supplied goods or services, where required under the provisions of this Chapter; (c) the complete address of the premises where goods are stored by him, including goods stored during transit along with the particulars of the stock stored therein. Tax on goods kept at other than declared location [Rule 56(6)] If any taxable goods are found to be stored at any place(s) other than those declared under rule 56(5) without the cover of any valid documents, the proper officer shall determine the amount of tax payable on such goods as if such goods have been supplied by the registered person. Additional records to be maintained by registered persons other than composition dealers (i) Stock records [Rule 56(2)] Every registered person, other than a person paying tax under section 10, shall maintain the accounts of stock in respect of goods received and supplied by him, and such accounts shall contain particulars of the opening balance, receipt, supply, goods lost, stolen, destroyed, written off or disposed of by way of gift or free sample and the balance of stock including raw materials, finished goods, scrap and wastage thereof. (ii) Accounts details of computation of tax [Rule 56(4)] Every registered person, other than a person paying tax under section 10, shall keep and maintain an account, containing the details of tax payable (including tax payable in accordance with the provisions of section 9(3) and (4), tax collected and paid, input tax, input tax credit claimed, together with a register of tax invoice, credit notes, debit notes, delivery challan issued or received during any tax period. Concequences on failure to maintain the account records, section 35(6) of CGST Act Subject to the provisions of section 17(5)(h) where the registered person fails to account for the goods or services or both in accordance with the provisions of section 35(1) of CGST Act , the proper officer shall determine the amount of tax payable on the goods or services or both that are not accounted for, as if such goods or services or both had been supplied by such person and the provisions of section 73 or section 74 [ or Section 74A (w.e.f. 01.11.2024 vide N.No. 17/2024 dated 27.09.2024) Inserted vide Finance (No.2) Act, 2024 ] , as the case may be, shall, mutatis mutandis, apply for determination of such tax. Special power of commissioner to prescribe addition record or separate record (section 35(3) and (4) of CGST Act) To maintain additional accounts/documents :- The Commissioner may notify a class of taxable persons to maintain additional accounts or documents for such purpose as may be specified therein. Relaxation by the commissioner:- Where the Commissioner considers that any class of taxable person is not in a position to keep and maintain accounts in accordance with the provisions of this section, he may, for reasons to be recorded in writing, permit such class of taxable persons to maintain accounts in such manner as may be prescribed.