GST Notice – Top Reasons, Types & Response

GST Notice: Under any Law, whenever any act is done opposite to what is required to done, then there are high chances, that one get served with the notice or intimation or warning. Laws are made to make compulsion, so there shall be uniformity in what all have to do. GST notices are the communications by the GST department or authorities with the taxpayers, regarding any irregularities observed by them.

Now a days, its very common that GST department convey their communication to the taxpayer about irregularities noticed by them through the notices. For different defaults made, and their intensity, different words are used for the NOTICES by the department, like Demand Notice, Show Casue Notice, Scrutiny Notice etc.

Read Also: Easy way for Reconciliation of GSTR 2A with GSTR 3B

Top Reasons of GST Notice

1. When any person or business is required to get registration under GST Act, but has not registered and not discharged GST taxes.
2. When a person is not eligible to be registered under the composition scheme of the GST
3. Difference in the turnover as declared in GSTR 1 and GSTR 3B
4. Difference in ITC availed and utilised as per GSTR 3B and ITC available as per GSTR 2A.
5. Delay in filling returns like GSTR 1 and GSTR 3B returns for continuous period.
6. Inconsistency in the data declared in GSTR 1 and E-way Bills generated.
7. Interest on GST liability is not discharged.
8. When GST is wrongly refunded, with or without fraudulent intentions.
9. Issue of notice when GST is not paid or short paid by the taxpayer, with or without any fraudulent intention.
10. Wrong classification of goods or services provided, effecting wrong levy of tax.
11. Mismatch in the details of Export reported under GSTR 1 and information lodged on ICEGATE.
12. Wrongly availed ITC and utilized.
13. When audit under GST is not conducted under the specified time.
14. Tax authorities are of the view that, audit is necessary to be done
15. When any additional information is required by the authorities, from the records maintained by the taxpayer.
16. Prices not reduced, after GST rates are reduced, by the date notified by the Central Board of Indirect Taxes and Customs (CBIC). The taxpayer does not reduce prices and thus commits the default of not passing on the benefit of reduced taxes to customers. Such a practice is known as profiteering and GST authorities have taken several measures for anti-profiteering which address such defaults.

Read Also: CBIC implements Quarterly Return filing scheme with Monthly Payment of taxes for small taxpayers

Modes of serving Notice under GST

1. Hand-delivering the notice either directly or by a messenger or by a courier to the taxpayer or his representative.
2. 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.
3. Communication through the email address.
4. Making it available on the GST portal after logging in.
5. By publication in a regional newspaper being circulated in the locality- that of the taxpayer based on the last known residential address.
6. 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.

Notices in GST Portal

The main problem faced by the taxpayers regarding notices is that many a times, they don’t understand how to check the notice on the GST portal. Earlier, notices were sent in hard copy at the registered address of the taxpayer, but in GST regime, there is additional modes like email or making notice available on common portal. So, one must know steps how to check any notice which are-

1. Log in on common portal > Click on User services > Click on View Notices

2. Or sometimes few notices are served under the heading View additional notices

Read Also: GSTR-3B : 10 common mistakes every taxpayers should avoid

List of Notices Form – Description and Response/ Precautions for the same

Notice Form	Description of Notice	Response/ Precautions
REG-03	Sent while verification of GST registration application to ask the taxpayer for clarifying details entered in the application and the documents provided. The same notice form is applicable for amending the GST registration.	Upload documents as mentioned and having clear  understanding.
CMP – 05	Show cause notice questioning taxpayer’s eligibility for composition scheme.	Always keep track of the turnover, so, if limit exceeds, you can opt for normal registration.
GSTR-3A	Default notice for the taxpayer who have not filed GST returns : GSTR 1, GSTR 3B, GSTR 4 or GSTR 8	File all the relevant returns due along with late fees, interest on the GST liability, if any.
ASMT-10	Scrutiny 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	Respond by giving reasons for discrepancies in the GST returns
RFD-08	Show cause notice of Rejection of Refund Application of taxpayer	Keep track of documents, information submitted and asked by the department.
ASMT – 02	Notice for Seeking Additional Information for provisional assessment under GST	Provide such information within the time.
ASMT -14	Show Cause Notice for assessment under section 63 – reasons for conducting the assessment on the best judgment basis	These notices are issued mostly when reply to earlier notices are not submitted, hence always file the replies on time.
ADT – 01	Notice for conducting audit	These audits are directed because of the complexity or huge defaults are made
REG – 17	Show cause notice why should the GST Registration not be cancelled for the reasons laid down in the notice	Apply for the cancellation of GST registration, only after filling all the returns till the date of cancellation, and provide clarification with documents for the reason of  cancellation

Read Also: GST Notice for GST Audit by the Department

Not Replying to the Notices

The taxpayer should respond promptly to the notice issued in his/her name within the time specified. In case, the taxpayer fails to do so, s/he will be legally acted upon. The GST authorities can eventually prosecute such a taxpayer or consider it as a purposeful default and charge the taxpayer with penalty.

But, as a good practice and timely reply to the notices, taxpayers are always advised to keep track of information reported on GST portal. If any irregularity or mistake is observed, taxpayer should try to correct the same in the most latest return, if possible. Also, taxpayer should reconcile all the returns with each other, like, turnover reported in GSTR 1 with GSTR 3B and e-way bills generated. Also, reconciliation of ITC availed in GSTR 3B with GSTR 2A or GSTR 2B.

Read Also: 15 Reasons you may get Income Tax Notice

For any questions, you may reach us at Discussion Forum

The author of the above article is CA Ankita Gandhi.

Disclaimer:The article or blog or post (by whatever name) in this website is based on the writer’s personal views and interpretation of Act. The writer does not accept any liabilities for any loss or damage of any kind arising out of information and for any actions taken in reliance thereon. 
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