# GST Show Cause Notice (DRC-01) — Sections 73, 74 & 74A

> A GST show cause notice is issued in Form DRC-01 when the officer believes tax was short-paid, not paid, wrongly refunded or input tax credit wrongly availed. Notices for periods up to FY 2023-24 are under Section 73 (non-fraud) or 74 (fraud); for FY 2024-25 onwards they are under Section 74A. The reply is filed in DRC-06, usually within 30 days, a personal hearing can be requested, and the outcome is recorded in an order summarised in DRC-07.

Practice: Tax Notices & Litigation — https://www.industax.com/services/tax-litigation/

Many notices are preceded by an intimation in DRC-01A or a scrutiny notice; paying or explaining at that stage can avoid the SCN altogether. Once an SCN is issued, the reply must deal with every allegation and quantification, with reconciliations and documents.

Penalty consequences differ sharply between non-fraud and fraud cases, so whether the notice invokes fraud or suppression is itself worth contesting. We prepare reconciliations (GSTR-1 vs 3B, 2B vs 3B, books vs returns), draft the reply and appear at the hearing.

## Key facts

| Item | Detail |
| --- | --- |
| Form | DRC-01 (SCN); reply in DRC-06 |
| Sections | 73 / 74 up to FY 2023-24; 74A from FY 2024-25 |
| Reply time | Usually 30 days, as stated in the notice |
| Hearing | Personal hearing can be requested |
| Order | Summary in DRC-07 |

## Who needs this

- Businesses with GST SCNs on ITC, short payment or classification
- Taxpayers with DRC-01A pre-SCN intimations
- Businesses facing demands on reverse charge, classification or exempt supplies

## What's included

- Allegation-wise analysis
- Reconciliations and evidence
- DRC-06 reply
- Hearing representation
- Payment strategy (DRC-03) where sensible

## Documents

- DRC-01 / DRC-01A and annexures
- GSTR-1, 3B, 2B, 9/9C for the period
- Books, invoices, e-way bills

## Process

1. **Analyse** — Each allegation and computation tested.
2. **Reconcile** — Return and books reconciliations prepared.
3. **Reply** — DRC-06 filed with evidence; hearing attended.
4. **Order** — Order reviewed; rectification or appeal planned.

## Also covers

- **GST demand** — Contesting the demand proposed in the SCN.
- **GST assessment** — Representation in GST adjudication proceedings.

## FAQs

### Which section applies to my GST notice?

For tax periods up to FY 2023-24, Section 73 or 74; for FY 2024-25 onwards, Section 74A, which merges the earlier two routes with different penalty levels.

### Should I pay the tax mentioned in the notice?

Pay only the amount you agree with, through DRC-03 linked to the notice; contest the rest with evidence.

### Can I ask for a personal hearing?

Yes, and a hearing must generally be granted before an adverse order.

## Official sources

- GST portal — Services > User Services > View Notices: https://www.gst.gov.in/
- CBIC — GST law and circulars: https://cbic-gst.gov.in/

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Canonical page: https://www.industax.com/services/tax-litigation/gst-show-cause-notice-drc-01
Publisher: Indus Tax — CA-led tax and compliance firm (https://www.industax.com). Contact: info@industax.com, 9059139258.
This is general information, not advice for your specific facts.