Regulation 32 — Audit Regulations 2020
Original Rule Text
32. Audit of receipts includes an examination of the systems, rules and procedures and their efficacy in respect of:
(1) Assessment, collection and allocation of revenue by the tax department; (2) Identification of potential tax assesses, ensuring compliance with laws as well as detection and prevention of tax evasion; (3) Pursuit of claims with due diligence and that these are not abandoned or reduced except with adequate justification and proper authority; (4) Prompt investigation of losses of revenue through fraud, default or mistake including, if required, through the review of other similar cases; (5) Exercise of discretionary powers in an appropriate manner including levy of penalties and initiation of prosecution; (6) Appropriate action to safeguard the interests of the Government on the orders passed by departmental appellate authorities; (7) Any scheme as may be introduced by the Government from time to time; (8) Any measures introduced to strengthen or improve revenue administration;
Regulations on Audit and Accounts 2020 29
(9) Amounts that may have fallen into arrears, maintenance of records of arrears and action taken for the recovery of the amounts in arrears; (10) Other ancillary and non-assessment functions including expenditure incurred by the departments; (11) Achievement of targets, accounting and reporting of receipts and their cross verification and reconciliation with the accounts records; (12). Amounts of refunds, rebates, drawbacks, remissions and abatements to see that these are correctly assessed and accounted for; (13) Use of information driven approach for improving tax compliance and effective utilisation of information in tax administration; (14) The grievance redressal machinery/ mechanism in place within the department for resolution of taxpayer grievances and complaints; (15) Requisite checks on assessment, realization, collection, recovery etc in respect of non-tax revenue; and (16) Any other matter, as may be determined by the Comptroller and Auditor General.
Access to IT systems and specific documents and records in relation to audit of expenditure and receipts
What This Means
Audit of government receipts involves a comprehensive examination of the systems, rules, and procedures governing revenue collection. This covers 16 areas including: assessment and collection of tax, identification of potential taxpayers, detection of tax evasion, pursuit of revenue claims, exercise of discretionary powers, recovery of arrears, refunds and remissions, use of information technology in tax administration, and the grievance redressal system for taxpayers. It also covers non-tax revenue checks and any other matter the CAG determines.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 116 areas of examination for receipt audit — from assessment to grievance redressal
- 2Checks whether revenue rules secure effective assessment, collection, and allocation
- 3Monitors detection of tax evasion and pursuit of claims with due diligence
- 4Examines discretionary powers including levy of penalties and prosecution
- 5Reviews arrears management, refunds, rebates, and remissions for accuracy
- 6Covers information-driven approaches for improving tax compliance
Practical Example
The CAG conducts an audit of GST collection by a State's Commercial Tax Department. Under Regulation 32, the audit team examines: (i) whether potential assessees are being identified through data mining (Reg 32(13)), (ii) whether arrears amounting to Rs 5,000 crore are being actively pursued (Reg 32(9)), (iii) whether refunds totaling Rs 800 crore were correctly assessed (Reg 32(12)), and (iv) whether the departmental appellate orders adequately protected government interests (Reg 32(6)).
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Does receipt audit only cover income tax?▼
Can the CAG examine how discretionary powers are exercised by tax officers?▼
Does audit look at the taxpayer grievance system?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.