Clarification regarding Annual Returns (GSTR-9 & 9C) and Reconciliation Statement

Role of chartered accountant or a cost accountant in certifying reconciliation statement:

There are apprehensions that the chartered accountant or cost accountant may go beyond the books of account in their recommendations under FORM GSTR-9C. The GST Act is clear in this regard. With respect to the reconciliation statement, their role is limited to reconciling the values declared in annual return (FORM GSTR-9) with the audited annual accounts of the taxpayer.

Payment of any unpaid tax:

Section 73 of the CGST Act provides a unique opportunity of self – correction to all taxpayers i.e. if a taxpayer has not paid, short paid or has erroneously obtained/been granted refund or has wrongly availed or utilized input tax credit then before the service of a notice by any tax authority, the taxpayer may pay the amount of tax with interest. In such cases, no penalty shall be leviable on such taxpayer. such taxpayers may pay the tax with interest through FORM GST DRC-03 at any time.

Primary data source for declaration in annual return:

It is important to note that both FORM GSTR-1 and FORM GSTR-3B serve different purposes. While FORM GSTR-1 is an account of details of outward supplies, FORM GSTR-3B is where the summaries of all transactions are declared and payments are made.  information in FORM GSTR-1, FORM GSTR-3B and books of accounts should be synchronous and the values should match across different forms and the books of accounts. If the same does not match, Further, no input tax credit can be reversed or availed through the annual return. If taxpayers find themselves liable for reversing any input tax credit, they may do the same through FORM GST DRC-03 separately.

Difficulty in reporting of information not reported in regular returns:

 Information in Table16A or 18 of Annual return in FORM GSTR-9. It has been observed that taxpayers are facing a lot of challenges in reporting information that was not being explicitly reported in their regular statements/returns (FORM GSTR-1 and FORM GSTR-3B). Therefore, taxpayers are advised to declare all such data/details (which are not part of their regular statement/returns) to the best of their knowledge and records. This data is only for information purposes and reasonable/explainable variations in the information reported in these tables will not be viewed adversely.