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Fix the driver behind crashes, sound loss and screen glitchesFind Drivers →Clear out junk files and repair common Windows errorsFree Scan →Scan for outdated or missing drivers - takes under a minuteDriver Scan →A GST recovery notice that arrives before a conventional assessment order is not automatically valid or invalid. Your first task is to identify the legal route: recovery of unpaid self-assessed tax can proceed under sections 75(12) and 79 of the Central Goods and Services Tax Act (CGST Act), while most departmental disputes must go through a show-cause notice and adjudication under section 73 or 74. An amount already confirmed by an order is governed principally by section 78 and its payment period. Preserve the notice, check the GST portal, reconcile the figures and tax period, and respond by the stated deadline. Obtain advice from a qualified GST practitioner, chartered accountant or tax lawyer if the amount is disputed or recovery is imminent.
Start by classifying the communication
The words “recovery notice” do not identify the procedure being used. Read the document and its attachments for the provision cited, the GSTIN, tax period, amount, issuing officer, service date and response deadline. A short email or letter may refer to a portal document that contains the legally significant details.
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| What the amount relates to | Typical statutory route | What you should look for |
|---|---|---|
| Tax that you reported or were required to report in a self-assessed return but did not pay | Section 75(12), with recovery under section 79 | Unpaid liability in a section 39 return, or qualifying outward supplies reported under section 37 but omitted from that return |
| Tax, interest, penalty or input-tax-credit issue alleged by the department and not accepted by you | Show-cause and determination under section 73 (non-fraud cases) or section 74 (fraud, wilful misstatement or suppression cases) | Notice requiring you to show cause, the allegations, relied-on workings and the hearing or reply date |
| Amount fixed in an adjudication order | Section 78 payment period followed, if unpaid, by recovery provisions | Order number, date and service proof; normally three months from service before recovery, unless the recorded-reasons proviso is used |
| Administrative reminder or pre-recovery communication | Depends on the underlying liability | Whether it cites a return, notice, order or a specific recovery power |
Do not treat a demand figure alone as proof that an assessment has occurred. Conversely, do not assume that the absence of an assessment order prevents every form of recovery.
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Section 75(12) is an express exception to the ordinary section 73/74 determination sequence. It provides that unpaid self-assessed tax and interest may be recovered under section 79. The explanation to that provision also addresses qualifying outward supplies shown in the details furnished under section 37 but not included in the return under section 39. In practical terms, a liability arising from your own return data can be treated differently from a new liability that an officer is asserting for the first time.
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This distinction matters when the notice alleges a difference between GSTR-1 and GSTR-3B. GSTR-1 contains outward-supply details; GSTR-3B is the return in which the tax liability is discharged. A mismatch can be caused by timing, amendments, credit notes, exports, exempt or non-GST supplies, duplicate reporting, a change in the place of supply, or a genuine omission. The department may not know which explanation applies unless you provide the records.
“Therefore, in all such cases, an opportunity needs to be provided to the concerned registered person to explain the differences between GSTR-1 and GSTR-3B, if any, and for short payment or non-payment of the amount of self-assessed tax liability, and interest thereon, before any action under section 79 of the Act is taken for recovery of the said amount.”
—CBIC GST Policy Wing, Instruction 01/2022-GST, dated 7 January 2022
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The instruction is directed at the covered self-assessed-liability situations. It should not be expanded into a rule that every disputed GST demand can be recovered without notice and adjudication. Explain the mismatch and attach evidence before arguing about the department’s power to recover.
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When a show-cause notice and assessment are ordinarily required
Section 73: cases not involving fraud
Section 73 concerns tax not paid, short-paid or erroneously refunded, and input tax credit wrongly availed or utilised, for reasons other than fraud, wilful misstatement or suppression of facts. The procedure includes a notice requiring you to show cause and an opportunity to answer the allegations before an amount is determined.
Section 74: fraud, wilful misstatement or suppression allegations
Section 74 covers the corresponding allegations where the department asserts fraud, wilful misstatement or suppression. The notice should identify the conduct relied on and the proposed tax, interest and penalty consequences. Because the classification can materially increase exposure, obtain professional advice rather than accepting a description you believe is incorrect.
If a communication asserts a fresh liability unrelated to your self-assessed return and there is no section 73 or 74 notice, ask the issuing officer to identify the statutory basis and the order or notice on which recovery is founded. Make that request part of your written response, without ignoring the response deadline.
Order-based recovery and the three-month period
Section 78 generally allows three months from service of an order for the amount payable under that order to be paid before recovery proceedings begin. The proviso allows a proper officer to require payment within a shorter period when the officer records reasons in writing and considers an earlier recovery expedient in the interest of revenue.
The three-month rule concerns an amount payable pursuant to an order. It is not a universal waiting period for every communication and should not be assumed to apply to a section 75(12) recovery of self-assessed tax. The GST Council’s official instruction index lists Instruction 01/2024-GST, dated 30 May 2024, on starting recovery before the ordinary three-month period. The actual order, written reasons, factual urgency, applicable tax statute and any appeal or stay must be checked in your case; do not infer detailed criteria from an index entry alone.
If the notice relies on the shorter-period proviso, ask for the order and the written reasons, note the exact service date and state any appeal, stay application or payment already made. A professional should review whether the recovery step matches the order and the current law in force.
What to do in the first 48 hours
- Preserve the complete record. Download the notice and every attachment from the GST portal. Save emails, SMS messages, portal timestamps, the physical envelope, courier tracking and any service metadata. Record the date, time and method of service.
- Identify the issuing authority. Note the officer’s designation, office, document number, GSTIN, tax period, tax heads (IGST, CGST, SGST or cess), interest and penalty, and the channel for filing a reply.
- Locate the cited provision. Mark every reference to sections 73, 74, 75(12), 78 or 79, Rule 142, and any state or Union-territory GST enactment. Determine whether the paper is a show-cause notice, an order, a DRC-01 or DRC-07 summary, a recovery instrument, or a reminder about self-assessed dues.
- Reconcile the amount. Compare the demand with GSTR-1, GSTR-3B, annual returns where relevant, invoices, credit and debit notes, e-way bills, payment challans, and the electronic liability, cash and credit ledgers. Check that the tax period and GST registration match.
- Search the portal history. Check whether earlier notices, hearing notices, orders, rectification communications or payment acknowledgements exist. A portal record may show service or an order that was not attached to an email.
- Prepare an evidence schedule. List each disputed invoice or return line, the amount claimed, your amount, the reason for the difference and the document proving it. Separate tax, interest, penalty and any amount already paid.
- File a timely response. Use the channel and format stated in the communication. Upload readable files, retain the acknowledgement or ARN, and keep the exact submitted version. If more time is needed, request it before the deadline and explain why.
- Escalate urgent or contested matters. Contact a GST practitioner, chartered accountant or tax lawyer promptly if a bank-account or receivables attachment is threatened, the notice alleges fraud, the amount is material, or the legal route is unclear.
Check DRC-01 and DRC-07 records on the portal
Rule 142 requires electronic summaries for specified GST notices and orders. DRC-01 is the electronic summary accompanying specified notices; DRC-07 is the electronic summary of specified orders stating the amount payable. CBIC Instruction 04/2023-GST directs officers to serve DRC-01 notice summaries and upload DRC-07 order summaries electronically.
Look under the GST portal’s notices, orders and additional notices sections, not only under your email inbox. Download the summary, the underlying notice or order and any demand computation. If a required summary was not served or uploaded, state that fact and preserve screenshots or download logs. CBIC describes failure to serve or upload the summaries as contrary to the explicit rules and relevant to recordkeeping and later proceedings; whether it changes the result in your case requires legal advice.
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DRC-03 is used for voluntary payment in the Rule 142 materials. An officer’s communication of an amount does not, by itself, make payment through DRC-03 mandatory. If you pay any amount, identify the tax period and heads, preserve the challan and ledger entries, and state whether the payment is full, partial or made without accepting the disputed position.
How to reconcile a GSTR-1 and GSTR-3B difference
Build a period-by-period comparison
Prepare a spreadsheet for each tax period showing taxable value and tax in GSTR-1, GSTR-3B liability, amendments, credit notes, advances, exports, exempt or non-GST supplies and payments. Use the same tax rate and tax-head breakdown as the notice. Explain timing differences where an invoice was reported in one period and paid in another.
Trace each exception to primary records
For material lines, attach invoice registers, invoices, credit-note registers, contracts, e-way bills, export or payment evidence, customer confirmations and ledger extracts. If the GSTR-1 entry was amended, show the original and amended return data. If tax was paid under another GSTIN or tax head, provide the challan and ledger trail and explain the correction sought.
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Address interest separately
Recalculate the period of delay, the tax actually unpaid and payments credited. A disagreement with the tax principal does not automatically resolve interest; show your calculation and the dates on which liability was discharged.
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Instruction 01/2022-GST supports giving the registered person an opportunity to explain covered differences before section 79 action. Your response should therefore request that recovery be kept in abeyance while the reconciliation and evidence are considered, while still answering every factual question in the notice.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.What a useful written response contains
- Heading and reference: GSTIN, document number, tax period, date of notice and officer’s office.
- Preliminary position: state whether the document appears to concern self-assessed tax, a section 73/74 proceeding, an order under section 78, or an unclear route.
- Chronology: filing dates, payment dates, earlier notices, replies, hearings and orders, with service dates.
- Reconciliation: a table matching the department’s figures to your returns, records and payments.
- Legal request: ask the officer to identify the statutory basis, provide missing computations or orders, and consider your explanation before recovery where the law requires that opportunity.
- Relief sought: withdrawal or correction of the demand, credit for payments, a speaking order, additional time, or suspension of recovery pending an appeal or review, as appropriate.
- Attachments and verification: indexed documents, file names, page numbers, contact details and proof of submission.
Do not make an unsupported admission merely to stop a call or email. Do not ignore a notice because you believe it is procedurally defective; preserve the objection while meeting the stated deadline.
Deadlines, appeals and recovery pressure
Use the deadline printed in the communication as the immediate control date, even if you believe the notice was served incorrectly. Mark the date on which a reply, hearing request, rectification application or appeal may be due. An order can create a separate payment and appeal timetable, and filing an appeal does not automatically produce a stay in every circumstance.
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Random freezes, missing sound and display glitches usually trace back to one bad driver. Find and replace yours safely.Free scan · under a minuteIf recovery action has begun, ask your adviser to examine whether the amount is self-assessed, whether a valid order exists, whether section 78’s recorded-reasons proviso was invoked, and whether any payment, appeal, pre-deposit or stay affects recoverability. Keep evidence of every request to the department and every portal submission.
Common mistakes that make a notice harder to resolve
- Assuming “before assessment” means recovery is automatically barred.
- Assuming section 75(12) permits recovery of every disputed departmental calculation.
- Ignoring GSTR-1/GSTR-3B differences instead of explaining them with transaction-level evidence.
- Counting the three-month period from the notice date when section 78 counts from service of an order.
- Relying only on an email and failing to check DRC-01, DRC-07 and other portal records.
- Paying through DRC-03 without stating the period, tax head and whether the payment is disputed or voluntary.
- Sending an unindexed bundle that does not show how each document answers the demand.
- Waiting until a bank or customer attachment is attempted before obtaining professional help.
A practical decision test
| Question | If the answer is yes | If the answer is no or unclear |
|---|---|---|
| Does the demand correspond to unpaid tax or interest that you self-assessed? | Review section 75(12) and possible section 79 recovery; reconcile and respond immediately. | Continue to the next question; do not assume recovery power. |
| Is the alleged liability a new departmental determination involving facts, classification or input tax credit? | Look for the section 73 or 74 show-cause process and answer the allegations. | Ask the officer to identify the legal basis and missing notice or order. |
| Is there an order stating the amount payable? | Check service, section 78’s three-month rule, any recorded-reasons shorter period and appeal or stay options. | Request the order and computation while preserving the response deadline. |
| Does the portal contain DRC-01 or DRC-07? | Download and match the electronic summary to the underlying document. | Record the absence and raise it in writing; obtain legal advice on its effect. |
Important scope limits
The CGST Act is the central statute considered here. State and Union-territory GST enactments, amendments in force on the date of your notice, the facts of the transaction and the status of any appeal can change the analysis. Published versions of the Act may not include every later amendment, so use a current consolidated text when checking section wording. This article cannot determine whether a particular recovery is lawful; that requires the complete notice, portal record, returns, payments and procedural history.
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