GST Notice in Trichy

What is a GST notice?

A GST notice is a formal communication from the department, or in some cases generated by the system itself, asking you to file something, explain something, or show cause why an amount should not be demanded from you. It is issued in a prescribed form under a specific provision of the CGST Act or the CGST Rules, and the form number is the fastest way to understand what you are actually facing.

Most notices are data-driven rather than suspicion-driven. The system compares GSTR-1 against GSTR-3B, GSTR-3B credit against GSTR-2B, GST turnover against the turnover in your income tax return, and e-way bill movements against declared outward supplies. Where the numbers do not reconcile, an intimation or a notice follows more or less automatically.

That is genuinely good news for a business with clean records. A mismatch you can explain with a reconciliation closes. What turns notices into demands is either an unexplained difference or a missed deadline — and the second is far more common than the first.

What are the common types of GST notices?

The table below maps the communications most businesses actually receive, the provision behind each, the form the reply goes in, and the window commonly allowed. Reply periods are stated in the notice itself and some have been revised, so always work from the dates printed on your document rather than from any table.

Two of these deserve to be at the top of your list even though they look mildest. An unanswered DRC-01B or DRC-01C blocks your next GSTR-1 or IFF, which means one ignored intimation stops the return chain for the whole business — see GST return filing.

Why do GST notices get issued?

The triggers are predictable, and almost all of them are visible in your own data before the department sees them.

• Outward liability declared in GSTR-1 not matching the tax paid in GSTR-3B
• Input tax credit claimed in GSTR-3B exceeding the credit available in GSTR-2B
• Credit claimed against suppliers who never filed, or whose registration was later cancelled
• Reverse-charge liability visible in the expense ledgers but never declared
• Credit reversals required where exempt or non-business supplies exist, but not computed
• GST turnover inconsistent with the turnover in the financial statements or the income tax return
• E-way bill movements exceeding declared outward supplies
• Returns not filed for one or more periods, including nil periods
• Refund claims that do not reconcile to export documentation or remittance evidence
• Registration documents that did not satisfy the officer, or premises that failed verification

Notice that none of these requires anyone to allege wrongdoing. They are arithmetic. The defence is arithmetic too — a reconciliation that names and explains each difference.

What is the difference between an intimation, a scrutiny notice, and a show-cause notice?

An intimation such as DRC-01B or DRC-01C is the system telling you a specific difference exists and asking you to pay it or explain it. There is no demand and no adjudication; the consequence of ignoring it is a block on your next return rather than a penalty.

A scrutiny notice in ASMT-10 is issued on scrutiny of your returns and communicates a discrepancy. It also does not propose a demand. You reply in ASMT-11, and where the officer accepts the explanation the matter is closed by an order in ASMT-12. Where it is not accepted, or no reply is filed, the officer can move to audit, inspection, or a show-cause notice.

A show-cause notice in DRC-01 is the serious one. It is the formal step that precedes a demand: it states the amount proposed, the section relied on, the period, and the grounds, and it invites you to show cause why that amount should not be recovered with interest and penalty. The reply goes in DRC-06, and if none is filed the officer can pass an order on the material already available.

How should you read a GST notice?

Before drafting anything, extract these facts from the document. Most bad replies come from answering a question the notice did not ask.

1. 1.The form number — it tells you the reply form and the nature of the proceeding
2. 2.The section or rule invoked, which determines the limitation period and the penalty exposure
3. 3.The tax period or financial year covered, and whether more than one year is involved
4. 4.The exact amount proposed, split between tax, interest, and penalty
5. 5.The specific grounds — mismatch, ineligible credit, non-payment, erroneous refund, or non-filing
6. 6.The reply deadline and whether a personal hearing date has already been fixed
7. 7.The issuing authority and jurisdiction, central or state
8. 8.Whether the notice attaches an annexure with invoice-level or period-level workings
9. 9.Whether it is a fresh proceeding or follows an earlier intimation you did not answer

Check the annexure against your own records line by line. It is common for a notice to be built from a portal comparison that has already been resolved — credit that was reversed in a later period, an invoice amended in the following quarter, a supplier who filed late. Those are complete answers, but only if you present the trail.

How do you reply to a GST notice on the portal?

1. 1.Log in and open Services, then User Services, then View Additional Notices and Orders
2. 2.Download the notice and every annexure, and diarise the reply deadline immediately
3. 3.Pull the underlying records — returns for the period, invoices, ledgers, and bank evidence
4. 4.Build a reconciliation that explains each figure in the annexure, difference by difference
5. 5.Decide what you accept and what you contest, and quantify both
6. 6.Pay any accepted liability with interest through Form DRC-03 before filing the reply
7. 7.Draft the reply to answer each ground separately, citing the document that proves the point
8. 8.Open the reply window for that notice and file in the correct form — ASMT-11, DRC-06, REG-04, REG-18, or REG-24
9. 9.Switch on the personal hearing option where the portal offers it
10. 10.Attach the reconciliation and supporting documents within the file-count and size limits
11. 11.Submit with DSC or EVC and download the filed reply and acknowledgement
12. 12.Track the notice until a closure order, a further notice, or an adjudication order appears

If you genuinely need more time, ask for it in writing before the original deadline and state a reason. An adjournment request filed on the last day is usually better received than a reply that arrives a week late, and the portal allows multiple adjournment requests until the order is passed.

What makes a good reply to a GST show-cause notice?

The department is not persuaded by tone. It is persuaded by a reconciliation that ties to the returns already on record and by documents that exist independently of your assertion.

• Answer ground by ground, in the order the notice raises them, with no ground left unaddressed
• Lead with the reconciliation table, then the explanation, then the supporting document reference
• Distinguish clearly between amounts accepted and amounts contested
• Attach the DRC-03 acknowledgement for anything already paid
• Cite the invoice, credit note, ledger entry, or return that establishes each point
• Where credit is disputed, show the invoice, the receipt of goods or services, and the GSTR-2B entry
• Where a mismatch was already corrected, show the later return in which it was corrected
• Where reverse charge is alleged, show the tax paid and the credit claimed on the same amount
• Rely on the statutory provision and any circular in your favour, quoted accurately
• Request a personal hearing expressly, so an adverse order cannot be passed without one

Keep the reply self-contained. The officer reading it may not have the earlier correspondence in front of them, and a reply that depends on something you filed two years ago is a reply that will be read as unsupported.

Do you have a right to a personal hearing?

Yes. The CGST Act requires that an opportunity of hearing be granted where a request is received in writing, or where an adverse decision is contemplated. On the portal there is a toggle for a personal hearing in the reply screen, available where the officer has not already fixed a hearing in the notice.

Use it. An order passed without the hearing you requested is vulnerable on appeal, and a hearing is frequently where a large proposed demand shrinks once the officer sees the reconciliation explained by someone who understands the transactions. Adjournments are permitted, though the Act limits how many times a hearing can be adjourned.

Take the working papers, not just the reply. The documents that settle a hearing are usually the ledger extract, the supplier reconciliation, and the payment challan — not legal argument.

What is the demand framework under sections 73, 74 and 74A?

For periods up to and including the financial year 2023-24, demands ran on a two-track system: Section 73 for cases without fraud, wilful misstatement, or suppression, and Section 74 for cases with them, each with its own limitation period and penalty. The distinction mattered enormously, because the fraud track carried a far longer window and a far heavier penalty.

From the financial year 2024-25 onwards, Section 74A was introduced as a single, unified demand provision covering non-payment, short payment, wrongly availed credit, and erroneous refunds, with a common limitation period for issuing the notice and passing the order, and penalty graded by whether fraud is established and by the stage at which you pay. The reduced-penalty payment window was also lengthened compared with the earlier regime.

Because the framework changed mid-stream, the first thing to establish about any demand is which year it relates to and therefore which provision governs it. The limitation periods, the notice and order windows, and the penalty percentages are all prescribed and have been amended, so the specific figures for your period should be confirmed against the current provision rather than assumed — that is exactly the kind of question worth an online CA consultation before you reply.

What happens after an adjudication order is passed?

The order is uploaded with a summary in Form DRC-07 specifying the tax, interest, and penalty payable, and the amount is posted to your electronic liability register. From that point you have four options, and doing nothing is not one of them.

If nothing is done, recovery follows — and recovery under GST is not gentle. It can include attaching your bank account, recovering from your customers, and in some circumstances provisional attachment of property. Once recovery begins, the cost of dealing with the matter rises sharply.

How does the GST appeal process work?

The first appeal is filed in Form APL-01 to the Appellate Authority, commonly within three months of communication of the order, with a further period condonable for sufficient cause. It requires payment in full of the admitted portion plus a prescribed percentage of the disputed tax as a pre-deposit — commonly ten per cent, subject to a statutory ceiling. Once the pre-deposit is made, recovery of the balance is generally stayed.

A second appeal lies to the GST Appellate Tribunal, with a further pre-deposit on the amount still in dispute. The Tribunal has been operationalised progressively, and both its filing windows and transitional deadlines for older appellate orders have been set by notification, so the current position should be checked for your specific order rather than assumed.

The percentages, ceilings, and the treatment of penalty-only orders have all been amended in recent finance legislation. Treat every number in this section as indicative and confirm it before you compute a pre-deposit — an appeal filed with a short pre-deposit is liable to be treated as defective.

What is Form DRC-03 and when should you use it?

DRC-03 is the mechanism for a voluntary payment of tax, interest, or penalty — before a notice is issued, after a pre-notice intimation, in response to a mismatch intimation, or alongside a reply where you accept part of a demand. An acknowledgement is issued in DRC-04.

Voluntary payment is usually the cheapest outcome available. Paying before a show-cause notice issues can bring the proceeding to an end for that amount, and paying within the reduced-penalty window stated in the provision limits penalty materially compared with contesting and losing.

Two cautions. Select the correct cause of payment and period, because a DRC-03 tagged to the wrong period does not close the right liability and may not validate against a DRC-01C reply. And do not use DRC-03 to pay something you genuinely dispute just to make a notice go away — it is very hard to unwind a voluntary admission later.

How do you avoid GST notices in the first place?

Nearly every notice we handle traces back to a reconciliation nobody ran. The controls below are unglamorous and they work.

• Tie GSTR-1 to GSTR-3B every single period, not at year end
• Tie credit claimed to GSTR-2B every period, and name every difference
• Review the Invoice Management System monthly rather than letting records be deemed accepted
• Chase non-filing suppliers in the same month, while they can still correct the return
• Identify and pay reverse-charge liability on imports of services, legal fees, and unregistered purchases
• Compute credit reversals where exempt or personal-use supplies exist
• Reconcile GST turnover to the financial statements and the income tax return annually
• File nil returns on time so the non-filing chain never starts
• Log in to the portal at least fortnightly, or set the registered email and mobile to someone who reads them
• Complete the GST annual return reconciliation properly, because it is the department’s best analytical input

The registered contact details deserve a special mention. Notices are served on the portal and intimated to the registered email and mobile. If those belong to a consultant you stopped working with two years ago, every window in this guide is running without you — fix it through a GST amendment.

What if a notice leads to cancellation of your registration?

A notice in REG-17 proposes cancellation and is answered in REG-18, commonly within seven working days. The practical difficulty is that the registration is often suspended from the date the notice is issued, which means you cannot raise a compliant invoice while you prepare the reply.

Where the ground is non-filing, the fastest route is usually to file the pending returns with tax, interest, and late fee, and say so in the REG-18. A cancellation proposed for non-filing is normally dropped once the default is made good. Where cancellation has already been ordered, the route back is revocation, and if that window closes the registration is gone and GSTR-10 becomes due.

Why choose Arjun Filings for GST notice?

Arjun Filings runs GST notice as a checklist-first engagement: a qualified CA or CS scopes the work, tells you exactly which documents are needed, and reviews every form before it is signed and submitted. You get a named specialist, a status update at each stage, and a compliance calendar for whatever comes next.

• CA-led desk for GST notice
• Checklist before portal submission
• Mismatch and notice awareness
• Clear status until certificate or ack