The Finance Minister in her Budget Speech on 1st day of February 2021, omitted  Section 35(5) and substituted Section 44 of CGST Act, 2017 by inserting Section 101 & 102 of the Finance Act, 2021. Here the intention of government is to simplify the Annual return for the financial year 2020-21, but there is no change in the format of GST annual return and reconciliation form. Thus, there is only shifting in responsibility of certification to the taxpayers instead of GST professionals.

As per section 44 of CGST Act, 2017 every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person shall furnish an annual return which may include a self-certified reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year, with the audited annual financial statement for every financial year electronically, within such time and in such form and in such manner as may be prescribed.

Further, as per Section 35(5) of CGST Act, 2017 every registered person whose turnover during a financial year exceeds the prescribed limit shall get his accounts audited by a chartered accountant or a cost accountant and shall submit a copy of the audited annual accounts, the reconciliation statement under sub-section (2) of section 44 and such other documents in such form and manner as may be prescribed.

In the Finance Act, 2021 vide Section no. 110 and 111 the Government has decided that the registered person is required to filed self-certified reconciliation statement instead of getting it certified by a chartered accountant or a cost accountant. For this the Central Government vide notification no. 29/2021-Central Tax, dated 30 July 2021 provides that the provisions of sections 110 and 111 of the said Act shall come into force w.e.f 1st day of August 2021.

Section 110 of the Finance Act, 2021 omitted the section 35(5) of the CGST Act, 2017. Further the Section 111 of Finance Act, 2021 seeks to amend section 44 of the CGST Act, 2017. As per Section 44 “Every registered person, other than an Input Service Distributor, a person paying tax under section 51 or section 52, a casual taxable person and a non-resident taxable person shall furnish an annual return which may include a self-certified reconciliation statement, reconciling the value of supplies declared in the return furnished for the financial year, with the audited annual financial statement for every financial year electronically, within such time and in such form and in such manner as may be prescribed.

However, exemption is provided to following:

• Any department of the Central Government or a State Government or a local authority, whose books of account are subject to audit by the Comptroller and Auditor-General of India, or an auditor appointed for auditing the accounts of local authorities under any law for the time being in force
• The registered person whose aggregate turnover in the financial year 2020-21 is upto two crore rupees from filing the annual return for the financial year 2020-21 (insert vide notification no. 31/2021-Central Tax)

Consequently, changes have also been made in rule 80 and FORM GSTR 9 and 9C of the CGST Act 2017 vide notification No. 30/2021- Central Tax, dated 30 July 2021.