Assessment, Audit, Inspection, Offences, Penalties and Appeals under GST (Overview) Questions

Question 1

Define assessment under GST (basic).

Accepted Answer

**Assessment** means determining/verifying a taxpayer’s **tax liability** (or refund) based on returns/records as per GST provisions (concept/overview).

Question 2

GST is a self-assessment system. (True/False)

Accepted Answer

True. GST is largely based on **self-assessment** through returns and payment (concept).

Question 3

State one purpose of GST audit.

Accepted Answer

To verify correctness of turnover/tax payment and **ITC** claimed by examining records and returns (concept/overview).

Question 4

Appeal is a remedy to challenge a GST order. (True/False)

Accepted Answer

True. **Appeal** is a legal remedy to challenge an order passed by a GST authority (concept/overview).

Question 5

Issuing fake invoices without supply is an offence. (True/False)

Accepted Answer

True. Issuing **fake invoices** without actual supply is treated as an offence under GST (concept/overview).

Question 6

Penalties are generally higher in fraud cases than genuine errors. (True/False)

Accepted Answer

True. **Fraud/wilful misstatement** generally attracts higher penalties than bona fide errors (overview).

Question 7

List any three types of assessment under GST (overview) using a table.

Accepted Answer

Types of assessment (overview):

| Type | One-line meaning |
|---|---|
| **Self-assessment** | taxpayer determines liability in returns |
| Provisional assessment | used when value/rate not certain (overview) |
| Best judgment assessment | officer assesses when returns not filed/non-cooperation (overview) |
| Summary assessment | urgent assessment to protect revenue (overview) |

Write any three types with one line each.

Question 8

Differentiate assessment and audit in GST (any three points) using a table.

Accepted Answer

Difference (concept/overview):

| Basis | **Assessment** | **Audit** |
|---|---|---|
| Focus | determination/verification of liability (often return-based) | examination of records to verify correctness |
| Trigger | self-assessment or officer action (overview) | departmental/authority audit process (overview) |
| Output | assessment order/decision (overview) | audit findings and possible demands (overview) |

Any three differences are sufficient.

Question 9

Give any three examples of offences under GST (exam points) with a small table.

Accepted Answer

Any three offences (concept/overview):

| Offence | Example |
|---|---|
| **Tax evasion** | suppression of sales/turnover |
| **Fake invoices** | invoice issued without actual supply |
| Wrongful **ITC** | ITC claimed on ineligible inputs |
| Collection without payment | GST collected but not paid to govt |

Write any three with one line each.

Question 10

Explain the basic appeal process in GST (any three steps) and draw a flowchart.

Accepted Answer

Basic steps (overview):

- order/decision is passed by authority
- taxpayer files **appeal** within prescribed time with form/fee
- hearing and appellate order; further appeal if required (overview)

Flowchart:

```text
Order -> Appeal filed -> Hearing -> Appellate order
```

Question 11

List any three basic principles of penalties under GST (exam points) using a table.

Accepted Answer

Basic penalty principles (concept/overview):

| Principle | Meaning |
|---|---|
| Higher for **fraud** | fraud/wilful misstatement attracts higher penalty |
| Lower for genuine error | bona fide mistakes may have lower penalty (overview) |
| Timely payment reduces burden | paying tax/dues early may reduce penalty exposure (overview) |

Write any three points in exam style.

Question 12

Differentiate inspection and audit under GST (any three points) using a table.

Accepted Answer

Difference (overview):

| Basis | **Inspection** | **Audit** |
|---|---|---|
| Nature | enforcement/check action at premises | systematic examination of records/returns |
| Trigger | suspicion/need for verification (overview) | planned audit process (overview) |
| Outcome | verification/search/seizure actions (overview) | audit findings and possible demand (overview) |

Any three differences are sufficient.

Question 13

Write an exam-style note on assessment and audit under GST (meaning, types/purpose, and key points) using headings and a table.

Accepted Answer

### Assessment (meaning)
**Assessment** is determining/verifying **tax liability** based on returns/records. GST is primarily **self-assessed**, but provisions cover provisional/best judgment cases (overview).

### Audit (purpose)
**Audit** examines records and returns to verify correctness of turnover, tax paid, refund claimed and **ITC** (concept/overview).

| Area | Assessment | Audit |
|---|---|---|
| Core idea | determination/verification of liability | examination of records for correctness |
| Outcome | assessment order/decision (overview) | audit findings, possible demand (overview) |

Conclusion: Both mechanisms ensure compliance and correctness in GST (concept).

Question 14

Explain inspection/search/seizure and offences/penalties under GST (exam-style) with a table and flowchart.

Accepted Answer

### Enforcement tools (overview)
- **Inspection**: checking premises/records.
- **Search**: looking for concealed evidence.
- **Seizure**: taking possession of goods/documents (overview).

### Offences and penalties
Offences include **tax evasion**, **fake invoices**, wrongful **ITC**, and collection without payment (concept/overview). Penalties depend on whether it is fraud/wilful misstatement or a genuine error.

| Item | Key idea (concept/overview) |
|---|---|
| Offence | violation like fake invoice / evasion |
| Penalty | monetary consequence; higher for fraud |
| Interest | for late payment of tax (overview) |

Flow (overview):

```text
Violation -> Notice/Investigation -> Order/Demand -> Payment/Penalty -> Appeal (if disputed)
```

Question 15

Write an exam-style answer on GST appeals: meaning, why appeals are needed, and basic stages (with a table/flow).

Accepted Answer

### Meaning
An **appeal** is a statutory remedy to challenge an assessment/audit/enforcement order if the taxpayer disagrees (concept/overview).

### Why appeals are needed
- ensures **fairness** and correction of errors
- provides a structured dispute resolution path
- builds confidence in compliance system (concept/overview)

| Stage | What happens (overview) |
|---|---|
| Order passed | demand/decision issued by authority |
| Appeal filed | within time, with prescribed form/fee |
| Hearing | taxpayer presents facts and law |
| Appellate order | decision passed; further appeal possible |

Flow:

```text
Order -> Appeal -> Hearing -> Appellate decision -> Further appeal (if applicable)
```

Conclusion: Appeals provide a formal mechanism to resolve disputes under GST (concept).

Type	One-line meaning
Self-assessment	taxpayer determines liability in returns
Provisional assessment	used when value/rate not certain (overview)
Best judgment assessment	officer assesses when returns not filed/non-cooperation (overview)
Summary assessment	urgent assessment to protect revenue (overview)

Assessment, Audit, Inspection, Offences, Penalties and Appeals under GST (Overview)

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