Last updated: 20 September 2026. A departmental GST audit under Section 65 begins with a notice in FORM GST ADT-01 served at least fifteen working days before the audit is conducted, must be completed within three months of commencement (extendable by up to six months by the Commissioner), and ends with findings in FORM GST ADT-02 within thirty days of conclusion. What you can be asked to produce is not open-ended — Section 71(2) lists it.
Applicability Note: This guide reflects the CGST Act and Rules as they stood on 20 September 2026, read from CBIC's active repository that day. Always verify the current position on gst.gov.in or with a GST professional before responding to an audit notice.
Who Should Care?
This guide applies to:
- Anyone who has received a FORM GST ADT-01, or expects one — the Act sets no turnover floor for a Section 65 audit
- Finance teams preparing the production file — several records an officer can demand are not GST records
- Anyone whose registration is cancelled, or already assessed by the State for a period the Centre now wants to audit
1. What a Section 65 Audit Is — and What It Is Not
Section 2(13) defines "audit" as the examination of records, returns and other documents maintained or furnished "under this Act or the rules made thereunder or under any other law for the time being in force", to verify the correctness of turnover declared, taxes paid, refund claimed and input tax credit availed. That closing limb is why an officer can ask for a document that has nothing to do with GST.
Under Section 65(1), the Commissioner or an officer authorised by him — by a general or a specific order — may audit any registered person "for such period, at such frequency and in such manner as may be prescribed". There is no turnover threshold. The audit may run at your place of business or in the officer's own office (Section 65(2)). Rule 101(1) fixes the unit of the period: a financial year, part of one, or multiples of one — "or part thereof" was inserted vide Notification No. 74/2018-Central Tax dated 31 December 2018, which is why a notice can lawfully cover a stub period.
This is not the audit businesses used to arrange themselves. Section 35(5), which required a chartered accountant or cost accountant audit above a prescribed turnover, was omitted by section 110 of the Finance Act, 2021 with effect from 1 August 2021 vide Notification No. 29/2021-Central Tax dated 30 July 2021. What replaced it is the self-certified reconciliation statement in FORM GSTR-9C under Rule 80(3), where aggregate turnover exceeds five crore rupees (Rule 80 as substituted vide Notification No. 30/2021-Central Tax dated 30 July 2021) — your obligation, and no substitute for the department's own exercise. See our guide to the annual return and GSTR-9C for FY 2025-26.
2. The ADT-01 Notice and the Fifteen Working Days
Section 65(3) requires that you be informed "by way of a notice not less than fifteen working days prior to the conduct of audit", and Rule 101(2) adds who issues it and in what form: the proper officer issues FORM GST ADT-01. The form names the years to be audited, states where the audit will be conducted, requires you to afford the facility to verify the books and to furnish information and assistance — the obligations in Section 65(5) — and directs attendance, in person or by authorised representative, with the books.
FORM GST ADT-01 [see rule 101(2)]: "In case of failure to comply with this notice, it would be presumed that you are not in possession of such books of account and proceedings as deemed fit may be initiated as per the provisions of the Act and the rules made thereunder against you without making any further correspondence in this regard."
Read that last clause literally. Ignoring an ADT-01 does not stall the audit — it converts your silence into a presumption that you do not hold the books, and proceedings may follow without any further correspondence about the books.
3. What the Officer Can Actually Ask You to Produce
Rule 101(3) describes what the officer verifies: the documents behind the books, the returns furnished, the correctness of turnover, exemptions and deductions claimed, the rate of tax applied, input tax credit availed and utilised, and refund claimed. That is not the production list.
The production list is Section 71(2), and it is the part most often missed. On demand, the person in charge of the premises must make available — to the authorised officer, to the audit party deputed by the proper officer, or to an accountant nominated under Section 66:
- records prepared or maintained by the registered person and declared to the proper officer in the prescribed manner
- the trial balance or its equivalent
- statements of annual financial accounts, duly audited, wherever required
- the cost audit report, if any, under section 148 of the Companies Act, 2013
- the income-tax audit report, if any, under section 44AB of the Income-tax Act, 1961
- any other relevant record
Two of those are prepared under other statutes entirely — Section 2(13)'s "or under any other law" limb doing its work. Section 71(2) allows "a period not exceeding fifteen working days from the day when such demand is made", extendable by the officer or audit party. Access to the premises is separate: under Section 71(1) the officer must be authorised by the proper officer not below the rank of Joint Commissioner.
Two fifteens, two different periods. Section 65(3)'s fifteen working days is the minimum notice before the audit is conducted. Section 71(2)'s fifteen working days is the maximum time to produce records once a demand is made. Only the production period is extendable by the officer.
4. The Three-Month Clock, and When It Starts
Section 65(4) requires the audit to be completed within three months of commencement. The extension power sits in the proviso, not the main text: where the Commissioner is satisfied it cannot be completed in three months, he may, "for the reasons to be recorded in writing", extend it by a further period not exceeding six months. Nine months is the outer limit, and the extension is the Commissioner's to grant on recorded reasons — not the audit officer's to assume.
Explanation to Section 65(4): "commencement of audit" means the date on which the records and other documents, called for by the tax authorities, are made available by the registered person or the actual institution of audit at the place of business, whichever is later.
Not the date of the ADT-01, and not the date it was served. Produce records in instalments and the clock starts on the later event — so a slow, partial production postpones the very deadline it might have been meant to press.
| Stage | Period | Provision |
|---|---|---|
| Notice before the audit is conducted | Not less than 15 working days | Section 65(3) with Rule 101(2), FORM GST ADT-01 |
| Production of records after a demand | Not exceeding 15 working days, extendable | Section 71(2) |
| Completion of the audit | 3 months from commencement | Section 65(4), main text |
| Extension of that period | Further period not exceeding 6 months | Proviso to Section 65(4), by the Commissioner, reasons in writing |
| Communication of findings | Within 30 days of conclusion | Section 65(6) with Rule 101(5), FORM GST ADT-02 |
5. Discrepancies, Your Reply, and ADT-02
Rule 101(4) is the only real opportunity to argue before findings harden, and its halves are worded differently. The proper officer may inform you of discrepancies noticed; you may file a reply; and the officer shall finalise the findings "after due consideration of the reply furnished". The discretion is in communicating discrepancies; considering a filed reply is not.
On conclusion, Section 65(6) requires the proper officer to inform you within thirty days of the findings, your rights and obligations, and the reasons for those findings — the thirty days lives in the section, not in Rule 101(5), which supplies only the form. FORM GST ADT-02, headed "Audit Report under section 65(6)", tabulates short payment of tax, interest and any other amount across each tax head, with the observations attached as a PDF.
6. What Happens After the Audit Report
ADT-02 is not a demand. Section 65(7) is the bridge: where the audit detects tax not paid, short paid or erroneously refunded, or input tax credit wrongly availed or utilised, the proper officer may initiate action under Section 73 or Section 74 or Section 74A — "or section 74A" having been inserted by section 133 of the Finance (No. 2) Act, 2024.
Which of the three depends on the period. Section 73(12) and Section 74(12), inserted by sections 136 and 137 of the same Act, confine those sections to tax "pertaining to the period up to Financial Year 2023-24"; Section 74A governs FY 2024-25 onwards. All of it came into force on 1 November 2024 by Notification No. 17/2024-Central Tax dated 27 September 2024 — part-way through the first financial year Section 74A covers, since a commencement date and a period of application are different quantities. What follows is an ordinary demand with the ordinary appellate route: see appealing a GST order under Section 107.
7. Where the Courts Have Pushed Back
Can you be audited after your registration is cancelled? The High Courts have divided.
The Madras High Court held in Tvl. Raja Stores v. Assistant Commissioner (ST) (Madurai Bench, W.P.(MD) No. 15291 of 2023, judgment dated 11 August 2023, S. Srimathy J.) that the words "any registered person" must "be construed as existence concern", so an unregistered person falls outside Section 65, and quashed the audit notice — expressly preserving the department's route under Sections 73 and 74.
The Rajasthan High Court took the opposite view in Ashoka Fabricast (P) Ltd. v. Union of India (Jaipur Bench, D.B. Civil Writ Petition No. 2859/2024, judgment dated 1 May 2024), dismissing the writ with costs: cessation of registration does not extinguish the audit power for periods during which the person was registered. The statutory support is Section 29(3) — cancellation "shall not affect the liability of the person to pay tax and other dues ... for any period prior to the date of cancellation".
The Supreme Court has not resolved the split. The petition against the Rajasthan judgment was dismissed as not pressed, not on merits (M/s Ashoka Fabricast Pvt. Ltd. v. Union of India, SLP (Civil) Diary No. 45031/2024, order dated 20 December 2024, Pardiwala and R. Mahadevan JJ.), with liberty to file a statutory appeal. Our note on cancellation and revocation covers what cancellation does and does not close.
Can the Centre audit a period the State has already adjudicated? In Abdur Rouf Khan v. Superintendent of Central Tax (Calcutta High Court, Appellate Side, WPA 3987 of 2025, order dated 9 July 2025, Raja Basu Chowdhury J.), a central Section 65 audit overlapped periods for which the State had passed Section 73 orders. The court applied Section 6(2)(b), which bars proceedings under the CGST Act where a State proper officer "has initiated any proceedings on a subject matter". The audit was restricted rather than quashed — permitted to proceed for 2017-2018 and 2022-2023, disallowed for 2018-2019 to 2021-2022. That is one single-judge order, and whether a Section 65 audit is "proceedings on the same subject matter" as a Section 73 adjudication is contested — an argument to make on the right facts, not settled law.
8. Special Audit Under Section 66 Is a Different Thing
A Section 66 special audit is a separate power, not an escalation. At any stage of scrutiny, inquiry, investigation or any other proceedings before him, an officer not below Assistant Commissioner who — having regard to the nature and complexity of the case and the interest of revenue — is of the opinion that value has not been correctly declared or credit availed is not within normal limits may, with the prior approval of the Commissioner, direct you to get your records audited by a chartered accountant or cost accountant nominated by the Commissioner. You do not choose the accountant. The report is due in ninety days, extendable by a further ninety by the Assistant Commissioner under the proviso to Section 66(2). The power applies even where your accounts are already audited under another law; you get a hearing on material proposed to be used against you; and the cost falls on the Commissioner. Rule 102 supplies the forms — the direction in FORM GST ADT-03, the findings in FORM GST ADT-04.
Key Takeaways
- Fifteen working days of notice is a floor, not a formality — Section 65(3) with Rule 101(2), in FORM GST ADT-01, issued by the proper officer.
- The three-month clock starts on the later of two events — records being made available, or the actual institution of audit at your premises. Only the Commissioner can extend it, by up to six months, on reasons recorded in writing.
- Section 71(2) is the production list — it reaches your cost audit report and your section 44AB income-tax audit report.
- File a reply to any discrepancy communicated. Rule 101(4) leaves the communication discretionary but consideration of a filed reply mandatory.
- ADT-02 is a report, not a demand — that comes under Section 73, 74 or 74A, by period.
Frequently Asked Questions
How many years can a GST audit cover?
Rule 101(1) fixes the unit, not a ceiling: a financial year, part of one, or multiples of one. Section 65(1) leaves the period, frequency and manner to be prescribed, so a single ADT-01 can name several years.
Why was my business selected for a GST audit?
The Act gives you no right to reasons for selection. Section 65(1) authorises the audit of any registered person "for such period, at such frequency and in such manner as may be prescribed", by general or specific order, and Rule 101(1) prescribes only the period. What you are entitled to are reasons for the findings — Section 65(6) requires them, with your rights and obligations, within thirty days.
What if I cannot produce the records in fifteen working days?
Section 71(2) reads "not exceeding fifteen working days from the day when such demand is made, or such further period as may be allowed" by the officer, the audit party or the nominated accountant. The extension is discretionary, so ask in writing before the period expires. This is the production clock, not the notice period under Section 65(3).
Disclaimer: This article is for informational purposes only and does not constitute professional tax advice. GST rules are subject to frequent changes through notifications and circulars. Please consult a qualified tax professional or verify the current provisions on the official GST portal (gst.gov.in) before making any compliance decisions.
Have a specific question about a GST audit notice? Ask our GST experts → gstconsultancy.com