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GST provisions have embedded the elaborate provisions for the recovery of tax under various situations has tax short paid or erroneously refunded or Input tax credit wrongly availed and non-payment of self-assessed or amount collected but not deposited to the Government. If such liability is assessed wrongly, it may be a result of taxescollected but not paid or short paid, input tax credit wrongly availed & utilised, erroneous refund claimed & subsequent to its identification, demand may be raised by GST officials. Sections 73 & 74 of the CGST Act, 2017, the circumstances under which a proper officer can serve a show cause notice for recovery of tax along with rest or penalty applicable.

SECTION 73:-

This section deals with determination of tax and its demand & subsequent recovery in situations resulting into:

> Taxes not paid;

>Taxes short paid;

>Tax erroneously refunded;

>Input tax credit wrongly availed or utilised;

>Recovery of interest payable which is not paid or partly paid or interest erroneously refunded.

But not involving any fraud, wilful misstatement or suppression of facts. 

TIME LIMIT FOR ISSUE OF NOTICE, PENALTY AND ADJUDICATION UNDER SECTION 73

Payment of Penalty  Amount of Penalty
Dues paid before issuance of show cause notice No penalty
Dues paid within 30 days of issuance of show cause notice No penalty
Dues paid after 30 days of issuance of order 10% of tax dues or INR 10000 whichever is higher
Any other case 10% of tax dues or INR 10000 whichever is higher

 SECTION 74:-

This section deals with determination of tax and its demand & subsequent recovery in situations resulting into by way of any fraud, wilful misstatement or suppression of facts:

>Taxes not paid;

>Taxes short paid;

>Tax erroneously refunded;”

> Input tax credit wrongly availed or utilised;

>Recovery of interest payable which is not paid or partly paid or interest erroneously refunded.

TIME LIMIT FOR ISSUE OF NOTICE, PENALTY AND ADJUDICATION UNDER SECTION 74

Payment of Penalty Amount of Penalty
Dues paid before issuance of show cause notice 15% of tax amount due
Dues paid within 30 days of issuance of show cause notice 25% of tax amount due
Dues paid after 30 days of issuance of Order 50% of tax amount due
Any other case 100% of tax amount due

DEMAND AND RECOVERY FORMS PRESCRIBED UNDER GST

GST DRC 01A Communication of the details of tax, interest or penalty ascertained by the proper officer in Part A and response thereto by the assessee in Part B
GST DRC 01 Summary of Show Cause Notice
GST DRC 02 Summary of Statement
GST DRC 03 Intimation of payment made voluntarily or made against the show cause notice (SCN) or statement
GST DRC 04 Acknowledgement of acceptance of payment made voluntarily
GST DRC 05 Intimation of conclusion of proceedings
GST DRC 06 Reply to the Show Cause Notice
GST DRC 07 Summary of the order
GST DRC 08 Summary of rectification or withdrawal of the Order
GST DRC 07A Summary of Order issued under existing laws
GST DRC 08A Summary of rectification, modification or quashing of Order issued under existing laws
GST DRC-09 Order for recovery through specified officer under section 79
GST DRC-10 Notice for Auction of Goods under section 79 (1) (b) of the Act
GST DRC-11 Notice to successful bidder
GST DRC-12 Sale Certificate
GST DRC-13 Notice to a third person under section 79(1)(c )
GST DRC-14 Certificate of Payment to a Third Person
GST DRC-15 Application before the civil court requesting execution for a decree application before the civil court requesting execution for a decree
GST DRC-16 Notice for attachment and sale of immovable/movable goods/shares under section 79
GST DRC-17  Notice for Auction of Immovable/Movable Property under section 79(1) (d)
GST DRC-18 Certificate action under clause (e) of sub-section (1) section 79
GST DRC-19 Application to the Magistrate for Recovery as Fine
GST DRC-20 Application for Deferred Payment/ Payment in Instalments
GST DRC-21 Order for acceptance/rejection of application for deferred payment / payment in instalments
GST DRC-22 Provisional attachment of property under section 83
GST DRC-23 Restoration of provisionally attached property/bank account under section 83
GST DRC-24 Intimation to Liquidator for recovery of amount
GST DRC-25 Continuation of Recovery Proceedings

Author Bio

I, Jyoti Mittal, a zealous and a motivated student pursuing Company Secretary course from Institute of Company Secretaries of India, and a law enthusiast pursuing LLB from Dr. BR Ambedkar University . I have completed my graduation in B.com Hons from Delhi University . Currently I'm a CS PROFESSI View Full Profile

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