If the taxable person does not provide a satisfactory explanation within 30 days of being informed (extendable by the officer concerned) or does not take corrective action within a reasonable period after accepting the discrepancies, the Proper Officer may take recourse to any of the following provisions:
- Proceed to conduct audit under Section 49 of the Act;
- Direct the conduct of a special audit under Section 50 which is to be conducted by a Chartered Accountant or a Cost Accountant nominated for this purpose by the Commissioner; or
- Undertake procedures of inspection, search and seizure under Section 60 of the Act; or
- Initiate proceeding for determination of tax under Section 51 of the Act.