Scrutiny usually begins with a system mismatch. The strongest response explains the mismatch before the officer treats it as tax short-payment or excess ITC.
Prepare return-wise and ledger-wise reconciliation and respond in ASMT-11 with supporting schedules.
Download ASMT-10 and working.
ASMT-10.
Ignoring small mismatches.
Section 61 and Rule 99 provide the scrutiny framework. ASMT-10 communicates discrepancies; ASMT-11 carries the taxpayer’s explanation; ASMT-12 can record acceptance.
A return mismatch is not automatically tax evasion. It may arise from amendments, timing, credit notes, reverse charge, advances or prior-period corrections.
Where the explanation is not accepted, the matter can move to audit, inspection or demand proceedings, so the initial response should be complete.
| Area | What to establish | Operating rule |
|---|---|---|
| Output tax | GSTR-1 versus GSTR-3B and books. | Map amendments. |
| ITC | Books versus GSTR-2B and 3B. | Separate ineligible credit. |
| Cash ledger | Tax, interest and late fee. | Reconcile challans. |
| Reply | ASMT-11 and evidence index. | Answer discrepancy-wise. |
GST control should connect five records: commercial contract, tax invoice, movement or service evidence, accounting entry and portal return. A filing that cannot be traced back to all five records is difficult to defend.
Every reconciliation should have a clear opening balance, current-period additions, corrections, reversals, payments and closing balance. Avoid unexplained plugs that make the total match but do not identify the invoice or legal reason.
Portal data is important but not conclusive by itself. GSTR-2B, e-invoice, e-way bill and ledger data should be read with the statute, rules, notifications, contracts and actual supply evidence.
Keep original source files and final filed versions. Screenshots help explain a portal event but should not replace downloaded returns, JSON, signed invoices, acknowledgements or bank records.
For material exposure, prepare a written position memo stating facts, issue, law, alternatives, conclusion, amount and approval. The memo should record uncertainty rather than hide it.
The litigation file should contain the notice, relied-upon documents, reply, evidence index, hearing request, hearing record and order in chronological order. Missing procedural records can be as important as the tax computation.
Separate admitted liability from disputed liability. Payment of one issue should be expressly linked so it is not misunderstood as acceptance of every allegation.
Start with the GST portal record, responsible business owner and tax working. Where the issue is operational, correct the source system and retain the acknowledgement. Where it is legal or disputed, obtain a reasoned professional position before payment, reply, refund or appeal.
Track the statutory or portal deadline separately from internal approval. Preserve helpdesk tickets, ARN, hearing requests, orders and payment records so a later reviewer can reproduce the entire path.
Before filing or replying, prepare a one-page issue sheet showing GSTIN, tax period, transaction type, amount, applicable provision, portal form, evidence owner and due date. This prevents different teams from solving different versions of the same problem.
Reconcile tax by CGST, SGST, IGST and cess rather than only by total. A total can match even when the wrong tax head, state or period has been used, which can still create interest, cash-flow and customer-credit consequences.
Build an exception register with five statuses: identified, evidence pending, vendor or customer action, tax treatment approved and closed. Every exception should retain its original amount even after correction so the audit trail remains visible.
Test the position against the counterparty’s records. Customer ITC, vendor GSTR-1, transporter data, marketplace statements and bank receipts can expose differences that are invisible in the taxpayer’s own ledger.
The final approval should record who reviewed the legal position and who approved the return, reply, payment, refund or appeal. Material GST decisions should not remain buried in informal email chains.
Create a chronology beginning with the transaction and ending with the current proceeding. Include every notice, adjournment, hearing, payment, submission and portal acknowledgement.
For each ground, cite the supporting annexure number and the exact page or row. Authorities should not have to search a large unindexed attachment to find the evidence.