What is Notice under GST
Notices under GST are communications by the GST Authorities. These are sent to the taxpayers specifically to remind or caution them of any defaults being noticed, specifically for not following the GST laws. In other cases, notices can be sent out just to collect more information from the taxpayer.
What are the consequences of not replying to GST Notices on time?
A taxpayer must promptly act or reply to notices within the time limit specified in such notice. Any failure to do so can land the taxpayer in a legal soup. In such eventuality, the authorities can proceed to prosecution or consider that as a willful default and charge penalty.
What are the common reasons for GST Notices?
Most common reasons for GST Notices are as follows:
· Mismatch in details reported between GSTR-1 & GSTR-3B: scrutiny notice
· Differences in Input tax credit claims made in GSTR-3B vis-a-vis GSTR-2B/2A
· Delay in filing of GSTR-1 and GSTR-3B consecutively for more than six months
· Inconsistent declaration in GSTR-1 and e-way bill portal
· Non-reduction of prices due to reduced GST Rates
· Non-payment of GST liability (tax) or the short-payment of the tax with or without the intent to defraud: show cause notice (SCN)
· GST Refund is wrongly made
· The Input tax credit is wrongly availed or utilized.
· Where a business is liable but has failed to obtain GST registration and not discharged the tax and other liabilities under the GST Act
· For furnishing any information related to records to be maintained by a taxpayer
· Conduct of the audit by tax authorities
· Where information return was required to be furnished before tax authorities, but not submitted within the time limit stipulated.
What are the valid modes of replying GST Notices?
Valid modes of sending GST Notices can be as follows:
· Hand-delivering the notice either directly or by a messenger by a courier to the taxpayer or his representative.
· By registered post or a speed post or a courier with an acknowledgement- addressed to the last known place of the business of the taxpayer.
· Communication to the email address
· Making it available on the GST portal after logging in.
· By publication in a regional newspaper being circulated in the locality- that of the taxpayer based on the last known residential address.
· If none of the above means is used, then by affixing it in some prominent place at his last known place of business or residence. If this is not found as reasonable by the tax authorities, they can affix a copy on the notice board of the office of the concerned officer or authority as a last resort.
The taxpayer need not act upon the notice or communication if it is received in any other modes apart from what is notified by GST law from time-to-time.
What are the various Forms of GST Notices?
Various forms of GST Notices are as follows:
Name of Form/Notice: GSTR-3A
Description: Default notice to non-filers of GST returns in GSTR-1 or GSTR-3B or GSTR-4 or GSTR-8
Reply or Action to be taken: File the particular GST Returns, that is yet to be filed along with late fees for the delay and interest on the GST liability, if any
Time limit to respond:15 days from the date of receiving notice
Consequence of non-response:Tax is assessed to the best judgment using the information available with the department. The penalty will be applicable of Rs. 10,000 or 10% of the tax due, whichever is higher.
Name of Form/Notice: CMP-05
Description: Show cause notice –Questioning the eligibility to be a composition dealer
Reply or Action to be taken: Must justify reasons as to why the taxpayer should continue to be eligible for the composition scheme
Time limit to respond: 15 days of receipt of the notice
Consequence of non-response: The penalty stipulated under section 122 and order in CMP-07 denying the benefit of composition scheme
Name of Form/Notice: REG-03
Description: At the time of verifying the application for GST registration, a notice can be sent requiring the clarification for the information provided in the application or documents needed for verification. Also, the same form for the notice is applicable for amendment of GST registration
Reply or Action to be taken: Reply letter in REG-04 with clarification or the information
Time limit to respond: Within 7 working days from the date of receiving the notice
Consequence of non-response: Reject such application and inform the applicant electronically in REG-05.
Name of Form/Notice: REG-17
Description: Show cause notice why should the GST registration not be cancelled for the reasons laid down in the notice
Reply or Action to be taken: Reply letter in REG-18 with the reasons for non-cancellation of GST registration
Time limit to respond: Within 7 working days from the date of receiving the notice
Consequence of non-response: Cancellation of GST registration in REG-19
Name of Form/Notice: REG-23
Description: Show cause notice why the cancellation of GST registration must be revoked, for the reasons laid down in the notice
Reply or Action to be taken: Reply letter in REG-24
Time limit to respond: Within 7 working days from the date of receiving the notice
Consequence of non-response: Cancellation of GST Registration will be revoked
Name of Form/Notice: REG-27
Description: In case of migration into GST by taxpayers of the VAT regime, a notice can be issued in REG-26 within the time limit prescribed, for not making application after obtaining provisional registration or not giving correct or complete details therein
Reply or Action to be taken: Reply by applying in REG-26 and appear before the tax authority giving reasonable opportunity to be heard
Time limit to respond: None prescribed
Consequence of non-response: Issue the cancellation of provisional registration in REG-28
Name of Form/Notice: PCT-03
Description: Show cause notice for misconduct by the GST practitioner
Reply or Action to be taken: Reply within the time prescribed in the show cause notice
Time limit to respond: Within the time prescribed in the show cause notice
Consequence of non-response: Order the cancellation of the license as GST practitioner
Name of Form/Notice: RFD-08
Description: Show cause notice as to why the GST refund must not be made to the applicant (taxpayer)
Reply or Action to be taken: Reply letter in RFD-09
Time limit to respond: Within 15 days of receipt of notice
Consequence of non-response: Make an order in RFD-06 for rejecting the GST Refund application
Name of Form/Notice: ASMT-02
Description: Notice for Seeking Additional Information for provisional assessment under GST
Reply or Action to be taken: Reply in ASMT-03 along with documents
Time limit to respond: Within 15 days from the date of service of this notice
Consequence of non-response: Application for provisional assessment may be rejected
Name of Form/Notice: ASMT-06
Description: Notice for seeking additional information for Final assessment under GST (for those who applied for provisional assessment)
Reply or Action to be taken: Reply in 15 days of receipt of the notice
Time limit to respond: Within 15 days from the date of receipt of this notice
Consequence of non-response: ASMT-07 can be passed without considering the views of taxpayer being assessed
Name of Form/Notice: ASMT-10
Description: Scrutiny notice -Notice for intimating discrepancies in the GST return after scrutiny along with tax, interest and any other amount payable in relation to such discrepancy, if any
Reply or Action to be taken: Reply in ASMT-11 giving reasons for discrepancies in the GST returns
Time limit to respond: Within the time prescribed in the show cause notice or a maximum time of thirty days from the date of service of notice or such deadline notified
Consequence of non-response: Proceed to assess the taxpayer based on information at hand – may lead to prosecution and penalty
Name of Form/Notice: ASMT-14
Description: Show Cause Notice for assessment under section 63- reasons for conducting the assessment on the best judgment basis
Reply or Action to be taken: Reply in written form and appear before the GST authority issuing the notice
Time limit to respond: Within 15 days of notice
Consequence of non-response: Assessment order in ASMT-15, may not be favouring the assessee
Name of Form/Notice: ADT-01
Description: Notice for conducting audit by Tax authority under Section 65
Reply or Action to be taken: Attend in person as directed in the notice or produce records
Time limit to respond: Within the time prescribed in the notice
Consequence of non-response: If not, it is presumed that taxpayer does not possess books of accounts and proceedings will be initiated
Name of Form/Notice: RVN-01
Description: Notice under section 108 issued to the taxpayer by the revisional authority before passing the revision order of appeals, giving the opportunity of being heard. Order of revision is usually passed to fix errors in order for appeals passed under section 108
Reply or Action to be taken: Reply within the prescribed time and/or appear before the GST authority passing the order of revision on a given date and time
Time limit to respond: Within 7 working days from the date of service of the notice
Consequence of non-response: The case will be decided ex parte on the basis of available records and on merits
Name of Form/Notice: Notice of Enquiry by Directorate of Anti-profiteering
Description: Where the supplier has not passed on the benefit of ITC or reduced GST rates to the recipient/consumer, proceedings may be initiated by the Directorate of anti-profiteering. All interested parties will get a notice asking for more details
Reply or Action to be taken: Cooperate in the proceedings and provide evidence, if any
Time limit to respond: As may be specified in the notice
Consequence of non-response: Proceedings will be initiated ex party on the basis on available evidence
Name of Form/Notice: DRC-01
Description: Show cause Notice for Demand of Tax- Is issued for demanding tax paid shortly or not paid with or without an intent to defraud. It is served along with a statement of details in DRC-02
Reply or Action to be taken: Reply in DRC-03 for paying the amount of tax demanded in the notice along with Interest and penalty*, if any applicable. Use DRC-06 to reply to the show cause notice
Time limit to respond: *Within 60 days of receipt of the notice
*Note: Where no fraud is committed, the penalty is chargeable only if payment is made beyond the thirty days time limit
Consequence of non-response: Order can be passed with higher penalty or prosecution- within three years from the due date of annual returns for the particular financial year for which tax is demanded
Name of Form/Notice: DRC-10 And DRC-17
Description: Notice of Auction of Goods under section 79(1)(b) of the Act- Reference to the order of demand will be given, being the order for recovery through specified officer under section 79 OR Recovery through execution of decree
Reply or Action to be taken: Must be able to pay the outstanding demand as per DRC-09
Time limit to respond: As may be specified in notice before the sale. Note that the last day of the bid or the last day of the auction cannot be before 15 days from the date of issue of the notice
Consequence of non-response: Proceed to e-auction and sale
Name of Form/Notice: DRC-11
Description: Notice to the successful bidder
Reply or Action to be taken: Pay the full bid amount
Time limit to respond: Within the 15 days from the date of the auction
Consequence of non-response: The proper officer can conduct a re-auction
Name of Form/Notice: DRC-13
Description: Notice of Recovery of outstanding tax from a third person
Reply or Action to be taken: Deposit the amount specified in the notice and reply in DRC-14
Time limit to respond: Not applicable
Consequence of non-response: Deemed to be a defaulter in respect of the amount specified in the notice and can be subject to prosecution and penalties
Name of Form/Notice: DRC-16
Description: Notice for attachment and sale of immovable/movable goods/shares under section 79
Reply or Action to be taken: A taxpayer receiving this notice is prohibited from transferring or creating a charge on the said goods in any way and any transfer or charge created by you shall be invalid
Time limit to respond: Not applicable
Consequence of non-response: Any contravention of the notice can invite prosecution and/or penalties
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