Definition of Assessment in GST

Defined under Section 2(11) of the CGST Act, 2017 — assessment means the determination of tax liability under the Act, and includes:

1. Self-Assessment (Sec. 59)
2. Re-Assessment
3. Provisional Assessment (Sec. 60)
4. Summary Assessment (Sec. 64)
5. Best Judgment Assessment (Sec. 62 and Sec. 63)

Basically, an assessment is a quasi-judicial proceeding adopted in fixing the correct liability to pay tax.

Note: There is no explicit provision permitting a Proper Officer to re-assess the tax liability of a taxable person — re-assessment is not provided in any specific section. A Proper Officer must take care not to carry out a roving exercise to redetermine liability except in case of rectification or any other method as provided in the law.

Concept of Best Judgement Assessment (BJA)

The definition of BJA is not provided under the GST Law. However, in general practice and as per other acts such as Income Tax Law, BJA means the assessment of a taxpayer carried out by the Assessing Officer (AO) as per the best of their judgement and based on all relevant information gathered, available material, and records.

Types of Assessments in GST

What Really Happens If You Do Not File Your GST Return? [Section 62]

Notwithstanding anything to the contrary in Section 73 or Section 74 (or Section 74A), where a registered person fails to furnish the return under Section 39 or Section 45 — even after service of a notice under Section 46 — the proper officer may proceed to assess the tax liability to the best of their judgement, taking into account all relevant material available or gathered, and issue an assessment order within five years from the date specified under Section 44 for furnishing the annual return for the relevant financial year.

Where the registered person furnishes a valid return within 60 days (earlier 30 days) of service of the assessment order, the order is deemed withdrawn — but liability for interest under Section 50(1) and late fee under Section 47 continues. If the valid return is not filed within 60 days, the taxpayer may furnish it within a further 60 days on payment of an additional late fee of ₹100 per day of delay beyond the initial 60 days; the assessment order is then deemed withdrawn, though interest and late fee liability still continues.

Stepwise Procedure for Assessment of Non-Filers [Sec. 62 & Rule 100(1)]

• Rule 68 — Notice to non-filers: A notice in FORM GSTR-3A is issued electronically to a registered person who fails to furnish a return under Section 39, 44, 45, or 52.
• If the taxpayer fails to furnish the return within 15 days of issue of FORM GSTR-3A, the proper officer may assess the tax liability per Rule 100(1) of the CGST Rules, 2017, based on material available on record and the circumstances of each case.
• Assessment orders under Section 62(1) are issued in FORM GST ASMT-13, with a summary uploaded in FORM GST DRC-07.
• If a valid return is filed within 60 days of service of the ASMT-13 order, the assessment is deemed withdrawn — but interest (Sec 50(1)) and late fee (Sec 47) still apply.
• If not filed within 60 days, the taxpayer may file within a further 60 days (120 days total from service) by paying an additional late fee of ₹100/day beyond the initial 60 days; the assessment is still deemed withdrawn, but interest and late fee liability continues.
• If no return is filed within this period, the order becomes final and cannot be withdrawn even if returns are filed later — though the aggrieved person may appeal under Section 107.
• Once FORM GST DRC-07 is issued, recovery proceedings for tax assessed in FORM GST ASMT-13 follow.

Forms Used for Proceedings under Section 62

Standard Operating Procedure for Non-Filers of Returns

CBIC, vide Circular No. 129/48/2019 dated 24.12.2019, issued a Standard Operating Procedure for the assessment of non-filers. A format of the notice to be issued under Section 46 instructs the defaulter to file pending returns within 15 days; failure to comply attracts Section 62 (best judgment assessment for non-filers) without further communication. The circular also prescribes guidelines to ensure uniformity in implementation across field formations.

Amnesty Scheme for Non-Filers (Deemed Withdrawal of Best Judgement Assessment Order)

A special amnesty scheme vide Notification No. 06/2023-CT dated 31-03-2023 allowed taxpayers who received best judgment assessment orders under Section 62(1) on or before 28.02.2023 to have these orders automatically withdrawn, if they filed all pending returns and paid the required tax, interest, and late fees between 1 April and 30 June 2023. Notification No. 24/2023-CT dated 17-07-2023 extended the deemed withdrawal date to 31-08-2023. This benefit applied regardless of ongoing or decided appeals, and was a one-time relief valid only for orders issued up to 28.02.2023.

Case Law — Joy Mathew vs. Union of India (2020): The Kerala High Court held that filing returns within 30 days under Section 62(2) nullifies assessment orders and cancels recovery notices.

Is Non-Registration a Loophole or a Liability? [Section 63]

Notwithstanding anything to the contrary in Section 73 or Section 74 (or Section 74A), where a taxable person fails to obtain registration even though liable to do so, or whose registration has been cancelled under Section 29(2) but who was liable to pay tax, the proper officer may assess the tax liability to the best of their judgment for the relevant tax periods, and issue an assessment order within five years from the date specified under Section 44 for furnishing the annual return. No such order may be passed without giving the person an opportunity of being heard.

Assessment Proceedings under Section 63

The procedure starts when a tax officer learns — through inspection, survey, enforcement, intelligence unit information, or other means — that a taxable person has failed to obtain registration or pay taxes despite being liable to do so.

• The Adjudicating/Assessing Authority (A/A) issues a Show Cause Notice to the taxable person, scheduling a personal hearing if required.
• If no reply is received, the A/A issues a reminder — a maximum of three reminders can be issued.
• The taxable person may reply and request a personal hearing (PH), or apply for an extension of the PH date — adjournment can be allowed a maximum of three times.
• If PH is not required, the A/A issues an Assessment Order (ASMT-15) or a Drop Proceeding order based on the reply.
• If PH is required, the A/A conducts the hearing and passes the order accordingly.
• If the taxable person does not reply even after three reminders, the A/A passes an ex-parte order to the best of their judgement based on available information and records.

Rule 100(2)

The proper officer issues a notice under Section 63 in FORM GST ASMT-14, containing the grounds on which the assessment is proposed on a best judgment basis. A summary of the notice is uploaded in FORM GST DRC-01. After allowing 15 days for the person to furnish a reply, the officer may pass an order in FORM GST ASMT-15, with a summary uploaded in FORM GST DRC-07.

Forms Used for Proceedings under Section 63

Data Sources Used to Track Non-Filers and Unregistered Persons

Implication of Section 62 on the Recipient (Buyer) — Rule 37A

New Rule 37A was inserted vide Notification No. 26/2022-CT dated 26.12.2022 to specify the mechanism for reversal of input tax credit already availed by the recipient in Form GSTR-3B. Where the supplier has furnished invoice or debit note details in Form GSTR-1 or IFF but has not furnished Form GSTR-3B by 30th November (earlier 30th September) of the subsequent financial year, the ITC availed by the recipient must be reversed along with interest.

If the recipient reverses the ITC on or before 30th November of the succeeding financial year, no interest is payable on the reversal; if reversed after 30th November, interest under Section 50 applies. The recipient may re-avail the ITC in Form GSTR-3B once the supplier furnishes their Form GSTR-3B.

Interest and Late Fees

• Interest and late fees apply even for non-filers and unregistered persons, independently of Sections 73 and 74.
• Interest (Section 50(1)): If tax is not paid within the prescribed time, interest of up to 18% is payable. If tax is declared late in a return under Section 39, interest applies only on the amount paid via the electronic cash ledger, unless proceedings under Sections 73, 74, or 74A have already commenced for that period.
• Late Fee (Section 47(1)): ₹100 per day, up to ₹5,000, for delay in filing returns under Sections 37, 39, 45, or 52.

Conclusion

GST compliance is not just about avoiding penalties; it is about unlocking peace of mind, credibility, and steady growth. Filing on time and staying registered turns obligations into opportunities. Think of compliance as your business's passport, not a burden — it does not restrict you, it is the currency of trust and the smartest investment, opening doors to trust, stability, and lasting success. Prevention is always cheaper than correction; discipline today secures freedom for tomorrow.