GST Jamku AICHAPTER VIII ACCOUNTS AND RECORDS
Accounts and other records
Section 35(1)
Every registered person shall keep and maintain, at his principal place of business, as mentioned in the certificate of registration, a true and correct account of
(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:
Provided that 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 places of business:
Provided further that the registered person may keep and maintain such accounts and other particulars in electronic form in such manner as may be prescribed.
In order to ensure transparency and compliance with tax regulations, every registered person is required to keep accurate records at their main place of business, as indicated in the registration certificate. These records should include the following details:
Production or Manufacture of Goods: Record the details of goods produced or manufactured by the business.
Inward and Outward Supply of Goods or Services: Keep a track of both incoming and outgoing goods or services, maintaining a comprehensive record.
Stock of Goods: Maintain an up-to-date inventory of the goods held in stock.
Input Tax Credit Availed: Record the input tax credits claimed by the business.
Output Tax Payable and Paid: Keep a record of the taxes due and paid for the goods or services provided.
Other Prescribed Particulars: Include any additional details as prescribed by the regulations.
Multiple Places of Business
If the registration certificate specifies more than one place of business, it is necessary to maintain separate accounts for each designated location.
Electronic Record Keeping
Additionally, businesses have the option to keep and maintain these records electronically. The specific manner in which electronic records should be maintained will be prescribed by the relevant authorities.
By adhering to these record-keeping requirements, businesses can ensure compliance with regulations and facilitate smooth operations.
Section 35(2)
Every owner or operator of warehouse or godown or any other place used for storage of goods and every transporter, irrespective of whether he is a registered person or not, shall maintain records of the consigner, consignee and other relevant details of the goods in such manner as may be prescribed.
In simple terms, if you own or operate a warehouse, storage place, or any location where goods are kept, or if you are a transporter (whether registered or not), you need to keep records. These records should include information about the person sending the goods (consigner), the person receiving the goods (consignee), and any other important details about the goods. Here's a breakdown of the key points:
1. Who Needs to Keep Records?
Owners or operators of warehouses, godowns, or any place used for storing goods must maintain records. Additionally, this requirement extends to transporters, regardless of whether they are registered or not.
2. What Information Should Be Recorded?
The records should include details about the consigner, consignee, and other relevant information about the goods. This helps in keeping track of the movement and storage of goods.
3. How Should Records Be Maintained?
The manner in which these records should be maintained will be specified by regulations. This ensures that everyone follows a standardized approach to record-keeping.
By adhering to these requirements, those involved in the storage and transportation of goods can ensure that important information is documented, making the process more organized and efficient.
Section 35(3)
The Commissioner may notify a class of taxable persons to maintain additional accounts or documents for such purpose as may be specified therein.
In simpler terms, the Commissioner has the authority to tell a group of people who have to pay taxes (taxable persons) to keep extra records or documents. The Commissioner specifies the reasons for these additional requirements in the notification.
Section 35(4)
Where the Commissioner considers that any class of taxable persons 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.
In the realm of taxation, it's essential for individuals or businesses to maintain accurate records. However, there are situations where certain groups of taxpayers may find it challenging to follow the standard accounting rules outlined in Section 35(4). In such cases, the Commissioner has the authority to grant permission for an alternative method of maintaining accounts. This article explores the provision in Section 35(4) that allows for this flexibility.
Section 35(4) in Simple Terms: Section 35(4) empowers the Commissioner to evaluate whether a particular group of taxpayers can adhere to the usual accounting practices. If, for valid reasons, the Commissioner determines that a class of taxable persons faces difficulties in maintaining accounts as per the standard requirements, he can grant permission for an alternative approach. This alternative method must be officially documented.
Granting Permission: When the Commissioner decides that a specific class of taxpayers needs an exception, he provides written permission for them to maintain their accounts in a manner specified by the regulations. This flexibility acknowledges that not all individuals or businesses operate under the same circumstances, and some may require adjustments to fulfill their accounting obligations.
Ensuring Compliance: Even though alternative methods may be permitted, it's crucial to note that the aim is to ensure compliance with accounting standards. The Commissioner's decision is not a blanket exemption from keeping records but rather a tailored solution for those facing genuine challenges. This approach maintains the integrity of financial reporting while recognizing the diverse needs of taxpayers.
Conclusion: Section 35(4) serves as a tool for the Commissioner to address the unique challenges faced by certain classes of taxable persons in maintaining accounts. By allowing flexibility and providing written permission for alternative methods, the tax system aims to strike a balance between standardization and accommodation, ensuring that everyone can fulfill their accounting obligations effectively.
Section 35(5)
Section 35(6)
Subject to the provisions of clause (h) of sub-section (5) of section 17, where the registered person fails to account for the goods or services or both in accordance with the provisions of sub-section (1), 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, as the case may be, shall, mutatis mutandis, apply for determination of such tax.
When a registered person doesn't properly account for goods or services, there are consequences outlined in section 35(6). However, there are exceptions mentioned in clause (h) of sub-section (5) of section 17. In such cases, the proper officer steps in to assess the tax payable on the unaccounted goods or services, treating them as if they had been supplied by that person.
Tax Determination Process
The proper officer determines the amount of tax payable on the goods or services that were not properly accounted for. This process is akin to considering these unaccounted goods or services as supplied by the registered person. The applicable provisions for tax determination are outlined in either section 73 or section 74, depending on the circumstances. These provisions are applied mutatis mutandis, meaning they are adapted as needed for the specific situation.
In summary, failing to adhere to the accounting provisions outlined in sub-section (1) of section 35(6) can lead to the determination of tax payable by the proper officer, invoking the relevant sections for the assessment of such tax.