GST Notices and How to Reply: ASMT-10, DRC-01, REG-17

GST notices have become far more frequent as the system auto-compares GSTR-1, GSTR-3B, GSTR-2B, e-way bills, e-invoices and income tax data. Most notices come from data mismatches, and many can be closed with a clear reconciliation. What hurts is missing the deadline, because GST orders are often passed ex parte (without hearing you) if you don’t respond.

Step 1: Identify the notice

Notice / form	What it means	Reply in	Time to reply
DRC-01B	Liability in GSTR-1 is higher than GSTR-3B for a period	Part B of DRC-01B: pay or explain	7 days
DRC-01C	ITC claimed in GSTR-3B exceeds GSTR-2B	Part B of DRC-01C: pay or explain	7 days
ASMT-10	Scrutiny of returns (section 61): discrepancies found by the officer	ASMT-11	30 days (or as stated)
REG-17	Show cause notice for cancellation of registration (e.g. non-filing of returns)	REG-18	7 working days
REG-03	Query on a new registration or amendment	REG-04	7 working days
DRC-01A	Pre-notice intimation of tax ascertained (optional for officers)	Part B of DRC-01A	As stated
DRC-01	Show cause notice (SCN) demanding tax, interest and penalty (sections 73, 74, 74A)	DRC-06	30 days (or as stated)
ADT-01	Notice of departmental audit (section 65)	Produce records	As stated
Summons (section 70)	To give evidence or produce documents	Appear in person	As stated

All notices appear on the GST portal under Services → User Services → View Notices and Orders (and under Additional Notices and Orders for case-based notices).

Which demand section applies?

Period	Section	Time limit for the order
FY 2017-18 to FY 2023-24, non-fraud	73	3 years from the due date of that year’s annual return
FY 2017-18 to FY 2023-24, fraud or suppression	74	5 years from the due date of the annual return
FY 2024-25 onward (both kinds)	74A	SCN within 42 months, order within 12 months of the SCN (extendable by 6 months)

Penalty and the benefit of paying early (section 74A)

Case	If paid within 60 days of the SCN	Otherwise
No fraud (genuine mismatch or wrong interpretation)	Tax + interest only: no penalty	Penalty 10% of tax or ₹10,000, whichever is higher
Fraud / wilful suppression	Penalty 25% (15% if paid before the SCN)	100% (50% if paid within 60 days of the order)

So if a demand is genuinely correct, paying early can save the entire penalty.

Step 2: How to draft a good reply

Read the notice and annexures. Note the period, the specific discrepancy and the amount.
Reconcile. Typical reconciliations:
- GSTR-1 vs GSTR-3B (output tax)
- GSTR-3B vs GSTR-2B / 2A (ITC)
- Turnover in GST returns vs books vs income tax return (ITR / Form 26AS)
- E-way bills vs GSTR-1
Explain each difference with evidence: amendments in later months, credit notes, ITC claimed in a later month, invoices of other GSTINs, exempt or non-GST supplies, and so on.
Pay what is genuinely due through DRC-03 and mention the payment in the reply.
Ask for a personal hearing. Under section 75(4) it must be granted where requested or where an adverse decision is contemplated.
Upload the reply in the correct form (ASMT-11 or DRC-06) and keep the acknowledgement.

Avoid: generic replies (“data is correct”), missing the deadline, or ignoring a notice because “it’s only a mismatch”.

Step 3: If an order goes against you

Stage	Forum	Time limit	Pre-deposit
First appeal	Appellate Authority (Form APL-01)	3 months from the order (+1 month with condonation)	10% of the disputed tax (cap ₹20 crore each under CGST and SGST)
Second appeal	GST Appellate Tribunal (GSTAT)	3 months from the appellate order	A further 10% of the remaining disputed tax

Filing the appeal with the pre-deposit stays recovery of the balance.

Rectification (section 161) is available for errors apparent on the face of the order.

Frequently asked questions

I received DRC-01C for an ITC mismatch, but the supplier filed late. What do I reply?
Explain, in Part B, that the invoices appear in a later GSTR-2B. Attach the GSTR-2B showing them, or reverse the excess if it is genuinely ineligible.

My registration was cancelled for not filing returns. Can it be restored?
Yes. File all pending returns with late fees and interest, then apply for revocation of cancellation (REG-21) within the time allowed.

Can I ignore an ASMT-10 if the amount is small?
No. If you don’t respond, the officer can start demand proceedings under section 73/74/74A, adding interest and penalty.

Received a GST notice? Garvita Jain & Co. prepares the reconciliation, drafts point-by-point replies, attends personal hearings and files appeals before the Appellate Authority and GSTAT. Contact us here, or at contact@garvitajainandco.com or +91 98678 16597.

This article is general information based on the law as of November 2026 and is not professional advice.

Sources

Official

Professional / CA publications

GST Notices and How to Respond