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GST NOTICES: What is gst notice and Types of Notices

  • Jul 29


Notices under GST serve as official communications from the GST Authorities to taxpayers. These notices are issued to remind or caution taxpayers regarding detected defaults in adhering to GST laws. Additionally, they may be utilized to gather additional information from taxpayers. Instances prompting notice issuance include situations where goods movement or service provision occurs without proper tax compliance or when taxpayers engage in suspicious activities.

GST authorities initiate actions based on various indicators, including insights from taxpayer GST Returns, inputs from other government departments, or information from third parties.

Notices may be termed differently, such as show cause notices (SCN), scrutiny notices, or demand notices, depending on the specific case's nature or the required taxpayer action. Common reasons for receiving GST notices include lapses such as failure to register under GST when required by law, non-filing or delayed filing of GST returns, non-payment or underpayment of GST, or incorrect claims of Input Tax Credit.

It's crucial for taxpayers to promptly respond to notices within the specified timeframe. Failure to do so may lead to legal repercussions, including prosecution or penalties for willful defaults.

This revised version provides a clear and concise overview of GST notices and their implications for taxpayers, enhancing readability and comprehension.

 Common Reasons for Issue of GST Notices by GST Department

1.Data Mismatch Between GSTR-1 & GSTR-3B: Scrutiny notice issued due to discrepancies in reported details.

2. Discrepancies in Input Tax Credit Claims: Differences between ITC claims in GSTR-3B and GSTR-2B/2A triggering scrutiny.

3. Delayed Filing of GSTR-1 and GSTR-3B:** Notices issued for consecutive delays exceeding six months.

4. Inconsistent Declarations in GSTR-1 and e-Way Bill Portal:** Notices prompted by conflicting declarations.

5. Non-Passing of GST Rate Benefits:** Default notices issued for failure to reduce prices post-GST rate reductions, a practice known as profiteering.

6. Non-Payment or Short-Payment of GST Liability:** Show cause notices (SCN) for unpaid or underpaid taxes, with or without fraudulent intent.

7. Wrongful GST Refund Claims:SCN issued for erroneously claimed refunds, with or without fraudulent intent.

8.Misuse of Input Tax Credit:Notices issued for wrongful availment or utilization of Input Tax Credit.

9.Failure to Obtain GST Registration: Notices sent when liable businesses fail to register and discharge tax liabilities under the GST Act.

10. Inconsistencies in Export Reporting: Notices issued for disparities between exports reported in GSTR-1 and those recorded on ICEGATE.

11.Information Furnishing:Notices for providing additional information related to taxpayer records.

12.Conduct of GST Audits: Notices initiated for conducting audits by tax authorities.

13.Non-Submission of Information Returns: Notices issued for failure to submit required information returns within specified time limits.

This refined version succinctly presents the common reasons for issuance of GST notices, enhancing clarity and readability.

Types of GST Notices 

  • GSTR-3A: Default notice for taxpayers failing to file GST returns (GSTR-1, GSTR-3B, GSTR-4, or GSTR-8).

  • CMP-05: Show Cause Notice (SCN) questioning eligibility for composition dealer status.

  • REG-03: Verification notice for GST registration applications, seeking clarification on details provided.

  • REG-17: SCN questioning why GST registration should not be canceled.

  • REG-23: SCN questioning why canceled GST registration should not be reinstated.

  • REG-27: Notice for migration from VAT to GST, addressing failures in application or details provided.

  • PCT-03: SCN for GST practitioner misconduct.

  • RFD-08: SCN questioning why GST refund should not be issued.

  • ASMT-02: Notice for additional information for provisional assessment under GST.

  • ASMT-06: Notice for additional information for final assessment under GST.

  • ASMT-10: Scrutiny notice for discrepancies in filed GST returns after scrutiny.

  • ASMT-14: SCN for assessment under Section 63, based on best judgment.

  • ADT-01: Notice for GST audit under Section 65.

  • Enquiry Notice by Directorate of Anti-profiteering: Notice for non-passing of ITC benefits, requesting additional information.

  • DRC-01: SCN demanding unpaid or shortly paid tax, with or without fraudulent intention.

  • DRC-10 & DRC-17: Notice for auctioning goods or recovery through specified officer or decree.

  • DRC-13: Notice for recovering outstanding tax from a third party.

  • DRC-16: Notice for attachment and sale of movable/immovable goods/shares under Section 79

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Frequently Ask Questions (FAQ's)

A: Notices under GST are communications by the GST Authorities. A notice so issued, depending upon the purpose or gravity of default or action required from the taxpayer, can be called by different names e.g. Show Cause Notice (SCN), Scrutiny Notice or Demand Notice.
A: As per Section 73(10), the said order must be issued within 3 years from the due date of furnishing the annual return for the relevant financial year to which the tax relates.
A: What is GST audit notice? GST Departmental Audit is the process of examining a taxable person's records, returns, and other documentation. The goal is to ensure that the turnover is declared, taxes paid, refunds claimed, and input tax credits claimed are valid, as well as to check compliance with GST regulations.
A: An offender has to pay a penalty amount of tax evaded/short deducted etc., i.e., 100% penalty, subject to a minimum of Rs. 10,000. For the 21 offences above, for fraud cases, the penalty will be 100% (minimum Rs. 10,000).
A: Any reply to the GST notices can be submitted online on the GST portal.
A: After receiving a notice in Form GSTR-3A, the taxpayer must file return in Form GSTR-3B or any other return, as the case may be, within 15 days of issue of such notice and discharge the tax liability along with late fee and interest, if any.
A: A notice in FORM GSTR-3A shall be issued, electronically, to a registered person who fails to furnish return under section 39 or section 44 or section 45 or section 52.
A: A Demand Notice under the Goods and Services Tax (GST) regime is a formal notice issued by the tax authorities to an individual or a company when they believe that the individual or company owes taxes under GST.
A: The proper officer may, by a notice in Form GST DRC-13, require any other person from whom money is due or may become due to such person or who holds or may subsequently hold money for or on account of such person, to pay to the credit of the Central or a State Government.
A: Below are the steps to reply to a scrutiny notice: Step 1: Select the 'Replies' tab on the case details page to view all the replies filed with the tax department. Step 2: To add a reply, click 'Notice'. Step 3: Enter your reply and payment details if any.
A: Some professionals believe that because notice pay recovery occurs in the course of employment, it is also exempt from GST.
A: The DRC – 01, according to Rule 142 (1), shall be served on the petitioner electronically along with the show cause notice issued under section 74(1) of the Act (which cannot be issued electronically).
A: DRC-07 is the summary of all orders. Every order which ultimately ends up in demand creation, liability is created through DRC-07.