A GST notice is a request for information or an explanation from the tax department. Most notices can be closed with a timely, well-documented reply. Ignoring one usually leads to an order passed without your side being heard. Follow these steps when a notice arrives.
Step 1: Confirm the notice is genuine
Log in to gst.gov.in and open Services > User Services > View Notices and Orders. Notices issued by central tax officers should also carry a Document Identification Number (DIN). Do not act on a notice you cannot trace.
Step 2: Identify the type of notice
| Notice | Purpose | Reply |
|---|---|---|
| REG-03 | Clarification on a registration application | REG-04, within 7 working days |
| REG-17 | Show cause notice for cancellation of registration | REG-18, within 7 working days |
| ASMT-10 | Discrepancies found in scrutiny of returns (section 61) | ASMT-11, within 30 days or the extended time allowed (Rule 99) |
| DRC-01A | Intimation of tax liability before a show cause notice | Part B of DRC-01A, or pay through DRC-03 |
| DRC-01 | Show cause notice demanding tax, interest and penalty | DRC-06, within the period stated in the notice |
| ADT-01 | Audit by the department (section 65) | Produce records on the dates fixed |
Show cause notices for periods up to FY 2023-24 are issued under section 73 (no fraud) or section 74 (fraud or suppression). For FY 2024-25 onwards, both situations are covered by section 74A. The notice must be issued within 42 months from the due date of the annual return, and the order within 12 months of the notice.
Step 3: Note the deadline and plan the reply
Write down the reply due date on the day you receive the notice. If you need more time to collect documents, request an extension on the portal before the due date, giving reasons.
Step 4: Reconcile your data
- GSTR-1 against GSTR-3B (output tax)
- GSTR-2B against input tax credit claimed in GSTR-3B
- E-way bills and e-invoices against reported sales
- Returns against your books of account and annual return
Most notices arise from mismatches in these reconciliations. Find the exact reason for each difference before you reply.
Step 5: Draft a point-wise reply
- Answer every point raised in the notice, in the same order.
- Support each answer with documents: invoices, payment proof, reconciliations and contracts.
- Refer to the relevant sections, rules, circulars and judgments where they support your position.
- Ask for a personal hearing. Under section 75(4), a hearing must be given where an adverse decision is contemplated or where you request one in writing.
Step 6: Pay the admitted amount
If part of the demand is correct, pay that amount with interest through Form DRC-03 and mention it in your reply. Under section 74A, in non-fraud cases, no penalty is levied if the tax and interest are paid within 60 days of the show cause notice.
Step 7: If an order is passed against you
The demand order is issued in Form DRC-07. You can appeal to the Appellate Authority within three months of the date of communication of the order (section 107), after paying the pre-deposit of 10% of the disputed tax.
Mistakes to avoid
- Missing the reply date, which can lead to an order passed without your side being heard
- Replying in general terms without documents
- Paying the full demand without checking whether it is correct
- Not keeping copies of the acknowledgement for the reply filed
References
This article is general information based on the law as on 10 November 2026 and is not professional advice. The position may change through amendments, notifications or circulars. Please consult a Chartered Accountant on the facts of your case before acting.
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