The Government of Rajasthan, Commercial Taxes Department, has issued comprehensive revised guidelines for scrutiny of returns under Section 61 of the Rajasthan Goods and Services Tax Act, 2017 (RGST Act) through Circular No. F.17(134) ACCT/GST/2017 PART-II-01613 dated July 07, 2026. The Circular seeks to ensure uniformity, standardise scrutiny procedures for forthcoming years and pending proceedings, and facilitate appropriate consequential action under Sections 73, 74 or 74A of the RGST Act, 2017, wherever required for demand and recovery.
The revised Circular has been issued in supersession of Circular No. F.17(151)ACCT/GST/2017/7602 dated 07.01.2022. It lays down a structured mechanism for selection of taxpayers, data-based identification of discrepancies, issuance of scrutiny notices, consideration of taxpayers’ explanations, closure of satisfactory cases and transfer of unresolved matters for jurisdictional adjudication.
Business Intelligence Unit to Lead Risk-Based Selection of Returns
Under the new framework, the Business Intelligence Unit (BIU) will periodically analyse data furnished by registered taxpayers and available on the GSTN Portal. The scrutiny process will be driven by specified risk parameters intended to detect inconsistencies in turnover, output tax liability, reverse charge liability, input tax credit claims and interest payments.
The identified parameters include excess outward tax reported in GSTR-1 vis-à-vis GSTR-9/GSTR-3B; lower turnover in GSTR-3B compared with GSTR-7 (TDS); lower turnover in GSTR-1 compared with GSTR-8 (TCS); lower reverse charge liability disclosed in GSTR-9 than reflected through suppliers’ GSTR-1; and excess outward liability indicated through E-way Bills compared with GSTR-3B.
The framework also targets potentially irregular ITC claims, including excess ITC claimed in GSTR-3B/GSTR-9 but not confirmed in GSTR-2A/2B or GSTR-9; excess ISD credit; ITC claimed from suppliers who have not filed GSTR-3B; ITC claimed from suppliers whose registrations have been cancelled; ITC availed beyond the statutory time limit under Section 16(4); and cases where GSTR-3B has been filed after the due date with interest short-paid or not paid.
Three Parameters Made Mandatory for Scrutiny
A significant feature of the Circular is that cases involving excess outward tax in GSTR-1 compared with GSTR-9/GSTR-3B, excess outward liability in E-way Bills compared with GSTR-3B, and ITC claimed from suppliers whose registrations have been cancelled are to be mandatorily considered for scrutiny. Suitable weightage may be assigned to the remaining parameters while preparing the selection list. Additional parameters may also be introduced with the prior approval of the Chief Commissioner, State Tax.
Scrutiny Cases to Be Cross-Checked with Audit Cases to Avoid Duplication
The Special Commissioner (BIU) will prepare the list of registered taxpayers selected for scrutiny, clearly mentioning all parameters on the basis of which a return has been selected. The draft list is required to be cross-referenced with cases already selected for audit so as to avoid duplication of proceedings. Final approval of the list will be obtained from the Chief Commissioner, State Tax.
Faceless Scrutiny through ITMS Enabled
After approval, cases may be allocated through the Integrated Tax Management System (ITMS) to officers across Rajasthan for faceless scrutiny, or to proper officers having territorial jurisdiction over the registered taxpayer, as may be decided from time to time. This represents a significant administrative move towards technology-driven and jurisdiction-neutral scrutiny.
The Circular further requires scrutiny officers to apply due diligence and conduct a complete and holistic examination of the selected taxpayer’s returns. Where additional discrepancies are noticed beyond those originally identified at the time of selection, such discrepancies are also to be included in Form GST ASMT-10.
Officers May Take Up Other Tax Periods and Additional Cases on Detection of Discrepancies
Where a discrepancy comes to the notice of an officer in respect of other tax periods of the same taxpayer, or even in the case of taxpayers not originally selected by Headquarters for scrutiny, the officer is required to update the relevant details on the ITMS Portal and proceed with scrutiny in the matter.
All Discrepancies to Be Communicated through GST ASMT-10
Where discrepancies are found after scrutiny and review of data, the proper officer will generate an intimation in Form GST ASMT-10 from the ITMS Portal under Section 61(1) of the RGST Act read with Rule 99(1) of the RGST Rules, 2017. The intimation must clearly specify all discrepancies noticed during scrutiny and is to be uploaded on the BO Web Portal.
Thirty-Day Window for Taxpayer Explanation in ASMT-11
A registered taxpayer may furnish an explanation in Form GST ASMT-11. Where the explanation is found acceptable, the proper officer will drop the proceedings and communicate closure through Form GST ASMT-12. The Circular specifically provides for submission of ASMT-11 within 30 days from service of ASMT-10, or within such further period as may be permitted by the proper officer.
Where the taxpayer accepts the discrepancy and pays the applicable tax, interest and other amounts by filing DRC-03, the proper officer may accept the reply/payment, drop the scrutiny proceedings and inform the taxpayer through ASMT-12.
Unresolved Faceless Scrutiny Cases to Be Transferred to Jurisdictional Proper Officer
Where no satisfactory explanation is furnished within the prescribed time, or where the taxpayer accepts the discrepancy but fails to take the necessary corrective measures in the relevant returns, the Scrutiny Officer conducting faceless scrutiny will transfer the case to the jurisdictional proper officer through the BO Web Portal.
The Scrutiny Officer is also required to attach a detailed finding/scrutiny report, along with comments and reasons for recommending further action. The attached manual forming part of the Circular outlines the system process for scrutiny of taxpayers outside the officer’s jurisdiction, including assignment of the “Scrutiny Officer” role, initiation of suo motu proceedings across jurisdictions, upload of approval/authority letters and recommendation of cases to officers within the taxpayer’s jurisdictional hierarchy.
Further Proceedings under Sections 73, 74 or 74A
After transfer, the Jurisdictional Proper Officer is required to initiate appropriate action and determine tax and other dues under Section 73, Section 74 or Section 74A, as applicable.
In cases where scrutiny results in detection of tax not paid or short paid, or input tax credit wrongly availed or utilised, exceeding ₹5 crore, adjudication proceedings can be initiated only after prior approval of the concerned jurisdictional Additional Commissioner (Administration), State Tax. This introduces an additional supervisory safeguard for high-value cases.
Deadline Fixed for Transfer of FY 2022-23 Cases
Where scrutiny has already been initiated by the Jurisdictional Proper Officer, such officer will proceed with the case accordingly. The Circular further directs that all such cases pertaining to FY 2022-23 shall be transferred to the Jurisdictional Proper Officer by 25 August 2026 at the latest.
No-Discrepancy Cases Also to Be Recorded on ITMS
Where scrutiny does not reveal any discrepancy, the proper officer must record the facts and reasons through the feedback functionality on the ITMS Portal within the prescribed time. The concerned Additional Commissioner (Administration) has been made responsible for monitoring the work of officers under their jurisdiction in accordance with legal provisions and stipulated timelines.
Technology-Driven and Standardised Scrutiny Mechanism
The revised guidelines establish an integrated scrutiny architecture combining BIU-based risk analytics, GSTN data comparison, ITMS allocation, faceless scrutiny, mandatory ASMT-based communication and jurisdictional follow-up for adjudication. The framework is expected to promote consistency in return scrutiny while enabling focused examination of high-risk mismatches involving turnover, tax liability, E-way Bills and input tax credit.
The Circular bears the approval of Anandhi, Chief Commissioner, State Tax, Rajasthan, Jaipur, and is dated 07 July 2026. It also states that the instructions contained in the Circular are restricted for official use only.
The Complete Guidelines can be accessed at: https://a2ztaxcorp.net/wp-content/uploads/2026/07/Raj-Circular.pdf
