In a significant move to enhance transparency and accountability in the indirect taxation system, the Central Board of Indirect Taxes and Customs (CBIC) has issued a strong directive to all Goods and Services Tax (GST) field formations across India. This directive focuses on ensuring timely and complete submission of records and information to the Comptroller and Auditor General (C&AG) audit teams during statutory audits.
Background and Reason for the Directive
The CBIC’s directive, communicated via Instruction No. 05/2025-GST (F. No. CBIC-20015/2/2025-GST) dated May 2, 2025, comes in the wake of critical observations recorded in the C&AG Audit Report No. 7 of 2024. The report pointed out serious lapses such as non-production or partial production of records by GST field officers during the audit processes conducted by the C&AG teams.
These issues were further raised during multiple exit conferences between the C&AG and the Ministry of Finance, highlighting a lack of cooperation from GST formations and the urgent need for corrective action.
CBIC’s Reminder of Constitutional Obligations
In its instruction, the CBIC reminded all Principal Chief Commissioners, Chief Commissioners, and Director Generals of their constitutional responsibilities. Citing Article 149 of the Constitution of India, the CBIC emphasized that the C&AG is empowered to audit accounts of the Union and State governments, including all bodies and entities funded by public resources.
As such, all GST officers are duty-bound to cooperate fully with the audit teams and ensure that all relevant records, files, and documents are provided without delay. The CBIC further underscored that any failure to comply could undermine the integrity and efficiency of the government’s auditing process.
Importance of Transparency and Accountability in GST Administration
The directive reaffirms the government’s commitment to good governance, fiscal transparency, and efficient tax administration under the GST regime. Timely cooperation with C&AG audit teams not only ensures compliance with constitutional provisions but also strengthens the credibility of the GST system in the eyes of stakeholders, including taxpayers, businesses, and the public.
Conclusion
The CBIC’s latest instruction serves as a wake-up call for all GST field officers to adhere strictly to audit protocols and fulfill their obligations under the law. With increasing scrutiny over public finances and administrative processes, ensuring seamless coordination with constitutional audit bodies like the C&AG is not just a legal requirement but also a step toward a more transparent and robust tax administration system.