Is Explanation enough for DRC-01C notice?

This query is : Resolved

N.V. Siva Ram Prasad (Querist)
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17 May 2024 i have filed April - 2024 GSTR-3B with some input difference regarding Credit Notes for the march & April 2024. will i received DRC01C for input difference?.. if so explanation in part B will be satisfactory for Closing DRC01C sir.. Pls help me?

Asha Kanta Sharma

Asha Kanta Sharma

(Expert)
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09 July 2024 If you have filed your GSTR-3B for April 2024 with input differences related to credit notes from March and April 2024, you may receive a DRC-01C notice from the GST department. Here’s how you can handle it:

1. **DRC-01C Notice**: This notice is issued for any tax liabilities or differences noticed by the tax authorities after assessing your GSTR-3B filings.

2. **Explanation in Part B**: When you receive the DRC-01C notice, you can provide a detailed explanation in Part B of the notice. This explanation should include:
- Clarification on the input differences related to credit notes from March and April 2024.
- Details of the credit notes issued and adjustments made in subsequent filings.
- Any other relevant information supporting your claim.

3. **Supporting Documents**: Ensure you have all supporting documents like credit notes issued, proof of adjustments made in GSTR-3B filings, and any communication related to the credit notes with your suppliers.

4. **Responding to the Notice**: It’s important to respond to the DRC-01C notice within the stipulated timeframe mentioned in the notice. Provide a clear and concise explanation along with all necessary documents to support your claim.

5. **Consultation with Tax Advisor**: If you’re unsure about how to respond or if you need assistance in preparing a satisfactory explanation, it’s advisable to consult with a tax advisor or GST consultant. They can help you navigate the notice and ensure compliance with GST regulations.

In summary, if you receive a DRC-01C notice for input differences related to credit notes, providing a detailed explanation in Part B of the notice along with supporting documents is crucial. This will help in resolving the issue effectively with the GST department.