In GST every taxpayer is required to self-assess the tax payable and then verification is done by the department. This verification is to be done through documentary checks. This requires taxpayers to keep and maintain accounts and records. In this article we are going to discuss about accounts and records to be maintained under GST-

Who is required to maintain books of accounts and at which place?

Every registered person shall keep and maintain books of accounts at his principal place of business (place of business which is mentioned in GST certificate) relating to every year. Where more than one place of business is specified in the certificate of registration, then accounts relating to each place of business shall be kept at such place of business.

Which accounts and records are required to be maintained

A true and correct account of following is required to be maintained-

1. Production and manufacture of goods
2. Inward and outward supply of goods or services
3. Stock of goods
4. Input tax credit availed
5. Output tax payable and paid
6. Other particulars as may be prescribed

Records prescribed in rules

In addition to the particulars mentioned above, the rules also provide that the registered person is required to maintain a true and correct account of-

• Goods or services imported/exported
• Supplies attracting payment on reverse charge basis
• Separate account of advances received and paid
• Name and address of persons to whom he has supplied goods or from whom he has received goods
• Particulars of the complete address of the premises where goods are stored by him

How the accounts and records will be maintained

Records may be maintained manually and also in electronic form. If the records are being maintained manually then it should be serially numbered. And if the records are being maintained electronically then no entry to be erased or overwritten. Backup of electronic records must be available. Data should be password protected and in electronic readable format. Data should be produceable on demand by department or any officer.

Now let us have a look on records to be maintained by different categories of persons

Agent-Every agent shall maintain accounts depicting the-

1. Authorization received from principal to receive and supply the goods on behalf of him
2. Particulars of goods or services supplied and received
3. Tax paid on supplies on behalf of the principal
4. Details of accounts furnished to every principal

Manufacturer - Every registered person manufacturing goods must maintain-

1. Monthly production account showing quantitative details
2. Detail of raw material used in manufacturing
3. Goods manufactured including waste and by products

Service provider - Every registered person supplying services has to additionally maintain-

1. Quantitative details of goods used in services
2. Details off input services utilized and services supplied

Persons executing works contract- Every registered person executing works contract shall keep separate accounts for works contract showing-

1. Names and addresses of the persons on whose behalf works contract is executed and supplier from whom goods/services are received
2. Description and quantity of goods received, or services utilized for works contract
3. Details of payment received for each works contract

Owner/ operator of a warehouse/Godown and transporter-Every Godown operator is required to maintain records of-

1. Period for which goods remain in warehouse
2. Particulars related to dispatch, movement, receipt and disposal of goods

Every transporter is required to maintain details of-

1. Goods transported / in transit
2. GST number of consigner and consignee for each of his branches

Composition scheme-Persons registered under composition scheme are not required to maintain following records and documents-

1. Commodity wise stock of goods
2. Details of tax payable, input tax credit, tax invoice, debit and credit notes and delivery challan

Period of retention of accounts

Every registered person is required to keep and maintain books of accounts or other records until the expiry of 72 months from the due date of furnishing the annual return for every year. But if registered person is party to an appeal or revision or any other proceedings before the appellate authority, tribunal or court whether filed by him or commissioner, shall retain books of accounts for period of one year after final disposal of such appeal, WHICHEVER IS LATER.

Failure to maintain accounts

Where the registered person fails to maintain accounts and records as per the law then 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 supplies has been made by that registered person. Provision of section 73 and 74 shall apply for determination of tax.

Important clarification

In the case of goods like tea, rubber, coffee etc. are supplied through an auction and the difficulties were being faced by the principal and auctioneer in maintaining books of accounts at each additional place of business related to the stock of said goods. Consequently, it has been clarified that the principal and auctioneer may declare the warehouses where such goods are stored as their additional place of business (APOB). Further if the auction of tea is taking place through private treaty, then books of accounts related to APOB may be maintained at principal place of business instead of APOB.

Conclusion

It is the duty of every registered person to maintain proper books of accounts as it works like evidence of supply of goods or services which the backbone of whole structure of GST.

Important Sections/Rules/Circulars