Can a single notice for conducting an audit u/s 65 be issued to cover multiple financial years?

The imperative underlying the conduct of an audit according to Section 65 is to ascertain any leakage of revenue, necessitating the issuance of a "Show Cause Notice," a pertinent question emerges: ?Moreover, it is critical to consider that Sub-Section (1) of Section 65 articulates as follows:

“….The Commissioner or any officer authorised by him, by way of a general or a specific order, may undertake audit of any registered person for such period [ Emphasis Added….] , at such frequency and in such manner as may be prescribed…”

?Further, Rule 101 of the GST Rule,2017 in Sub-Rule 1 states that,

?“…the period of audit to be conducted under sub-section (1) of section 65 shall be a financial year or part thereof or multiples thereof…”

The term "or" is generally interpreted disjunctively unless the context clearly suggests otherwise. This means that the options provided—**a financial year**, **part thereof, or multiples thereof—are alternatives and each stands as an independent choice.

??Practical Implications:

1. The audit period may be:

?? - A single financial year.

?? - A part of a financial year (e.g., a quarter or month).

?? - Multiple financial years (e.g., two or more financial years together).

?Whereas the Act employs the terminology "such period" in the singular, it is observed that the subordinate rules appear to extend their ambit to encompass multiple financial years. Moreover, it is a well-established tenet of jurisprudence that subordinate legislation is invariably subordinate to and cannot usurp the authority of superior legislation, as encapsulated by the maxim ogat lex, non lex scripta.["unwritten law]

?Furthermore, a pivotal question emerges regarding the permissibility of conducting a GST audit under Section 65 for multiple financial years within the same Notice of Audit (ADT-01). This inquiry gains particular importance in light of the aforementioned phrasing, which distinctly utilizes "such period" rather than the plural "such periods." In this context, one must consider whether the intent of the legislature may permit a broader interpretation that aligns with the underlying principles of fiscal accountability and transparency.

?Whereas a pertinent inquiry arises regarding the interpretation of the term “such period” employed within the framework of the ADT-01, it stands to reason that this phrase may be construed to encompass only a singular financial year. The deliberate use of the phrase "such period," as opposed to "such periods," indicates an intention to limit the scope to a single financial year.

?Moreover, one must consider the stipulated timeframe for responding to the ADT-01, which is set at a mere 15 days. This brevity of time is critical, as it strongly implies that such a period is ill-suited for addressing matters pertaining to multiple financial years. As the legal maxim "audi alteram partem" suggests, the right to be heard must be balanced with reasonable time for response; thus, a 15-day period for multiple fiscal years would clearly transgress the principles of due process.

?Furthermore, should a party be compelled to respond to the ADT-01 within this constrained timeframe concerning several financial years, it may be deemed a violation of procedural fairness, contrary to the established tenet that "justice delayed is justice denied." Such circumstances would warrant scrutiny under the lens of equitable doctrine, potentially undermining the integrity of the legal process itself.

?The phrase "such period" in the original text is somewhat vague and can lead to ambiguity regarding the duration of the audit. When it is specified as "such periods," it suggests the possibility of multiple timeframes over which audits can occur.