कारनीति भाग २६१: महाराष्ट्र वैट ऑडिट रिपोर्ट २०१७-१८ की समस्या और जानकारी. CA उमेश शर्मा

Arjuna (Fictional Character): Krishna, for the year 2017-18, taxpayers have to comply with both VAT Audit and GST Audit. But which form is applicable for VAT audit?

Krishna(Fictional Character): Arjuna, On 5th June 2018, government has issued a notification that the taxpayers to whom Maharashtra VAT audit is applicable have to upload the new 704 Form, but again in the notification issued on 10th October 2018, government has withdrawn the New 704 Form and has made applicable the old format of Form 704 for the period April 2017 to June 2017 as per notification issued in 2013. The due date for filing form 704 is 15th January, 2019.

Arjuna: Krishna, for whom the VAT Audit is applicable?

Krishna: Arjuna,for the year 17-18, VAT Audit will have to be carried out for the period from April 2017 to June 2017.If the turnover of the taxpayer for the period ending on 30 June 2017 exceeds Rs 25 lakhs, then VAT Audit is compulsorily.

Arjuna: Krishna, Which is the most important thing in VAT Audit?

Krishna: Arjuna, in VAT Audit the important thing is compliance of Law and accordingly annexure J1, J2 of VAT audit report. In Annexure J1 the dealer has to mention customer wise annual sales, VAT on such sales along with TIN numbers. Similarly in Annexure J2 the dealer has to give details of supplier wise purchases, VAT on them along with TIN numbers. If this information is submitted wrongly then the VAT authorities will levy penalty and interest on the differential amount. If the taxpayer doesn’t give the TIN number of the seller, then he will not be eligible to claim the ITC.

Arjuna: Krishna, What all problems the taxpayer will have to face in VAT Audit?

Krishna: Arjuna,The taxpayer should note the following problems: 1)In Annexure ‘F’ of Form 704, the taxpayer has to take different financial ratios. This time Audit period is April 2017 to June 2017, but then also, the taxpayer has to consider the period of April 2017 to March 2018 for GP Ratio and NP Ratio. 2)In the same order, taxpayer has to take the value of closing stock as on 31st March 2018 of Raw material, WIP, Packing material, finished goods in the Form 704. 3)The taxpayer has to give the reconciliation of sales and purchases in Annexure ‘K’, but this year, the taxpayer has to show the reconciliation of GST turnover and VAT turnover with Annual turnover. 4)In VAT Audit form, there is no place to mention the details related to Trans 1. Hence, where to mention the same is still the question.

Arjuna: Krishna, Krishna, What will happen if the dealer does not file the VAT Audit report on time?

Krishna: Arjuna,If VAT Audit report is not submitted on time, then the penaltyamounting to 1/10th of total Sales Turnover is required to be paid. That means the taxpayer has to file the VAT Audit report on time.

Arjuna:What one should learn from this?

Krishna: Arjuna, It is very important to give correct information relating to sales and purchase. So many transactions were incurred to earn money by evading taxes. But in the information technology world, government departments give the information relating to taxpayers to each others. Because of this, tax evaders will be caught on one day. So, every taxpayer should file audit report and return with correct information.

 

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