DRC-07 Advisory

Download as pdf or txt
Download as pdf or txt
You are on page 1of 4

भारतसरकार।GOVERNMENT OF INDIA | वित्तमंत्रालय।MINISTRY OF FINANCE | राजस्िविभाग।DEPARTMENT OF REVENUE

प्रणालीएिंआंकडाप्रबंधनकेअपरमहाननदे शककाकायाालय,बेंगलूरु
OFFICE OF THE ADDITIONAL DIRECTOR GENERAL OF
SYSTEMS AND DATA MANAGEMENT, BENGALURU
पी.बी.सं.5400, केंद्रीयराजस्िभिन, क्िीन्समागा, बेंगलूरु – 560 001.
P.B. № 5400, Central Revenue Building, Queen’s Road, Bengaluru – 560 001.
__________________________________________________________________________________________
मम.सं.IV/16/04/2017 प्र.नन.बें.
C.No.IV/16/04/2017 DG Sys Blr Dated : 26th October, 2018

DSR ADVISORY NO.01/2018 dated 26.10.2018

SUB: Release of module for preparation and uploading of digital summary of


a demand order in GST (FORM GST DRC-07) and update liability register
to enable taxpayer in payment of the tax/interest/penalty- Reg

Bangalore Zonal unit of Directorate of Systems and Data management is entrusted


with task related to development of modules in the phase 2 of GST Systems. Dispute
settlement and resolution(DSR), Investigation, Audit and E-way Bill related modules are being
developed under the supervision of this unit. Dispute settlement and resolution covers entire
spectrum of activities involving issue of show cause notices/statement of demands,
adjudication, appeals, review, revision till recovery in the life cycle of dispute. As a part of the
phase wise development of DSR modules, we are now ready for release of a module aimed at
preparation and uploading of digital summary of a demand order in GST (FORM GST DRC-07)
to enable taxpayer in payment of the tax/interest/penalty. Consequent to UAT, DRC 07
module is now available. All other modules are at different stages of development and we
propose to bring them in phases.

2. Kind attention is invited to Sub-Rule (5) of Rule 142, of CGST Rules, which mandates
uploading of the summary of the order issued under sub-section (9) of section 73 or sub-
section (9) of section 74 or sub-section (3) of section 76 or section 125 or section 129 or section
130 of the CGST Act, electronically in FORM GST DRC-07, specifying therein the amount of tax,
interest and penalty payable by the person chargeable with tax. The facility of generation and
uploading of FORM GST DRC-07 electronically has been provided and the departmental
officers can henceforth make use of the same. This functionality allows tax officer to create a
liability in Liability ledger part II (other than return related liability) and allows taxpayer to set
off the liability using cash/credit ledger. An overview of the module is enumerated as under:

a) FORM GST DRC-07(digital summary of the demand order) is an online functionality made
available to the tax officer for issue in CBEC-GST portal consequent to the manual issue
of Adjudication order as specified under above mentioned sections of the CGST Act,
2017. Modules on adjudication emanating from the stage of show cause notice till the
stage of generation of demand order (order in original) is under development and will
allow auto generation of DRC-07 from Order in original.
b) This module is released as a stop gap arrangement pending development of entire suite
of DSR functions to ensure that all the demands against a tax payer, especially those
related to manually issued orders, if any, and MOV-09/MOV-11 orders issued in respect
of e-way bill issues are mapped in the liability ledger of the tax payer., Hence the module
allows Range and Division officers to create a DRC-07 entry. A demand order under GST
is essential before creation of DRC 07. Hence it is imperative that a copy of each and
every demand order issued manually under GST Act(s) is given to the Range Officer. The
module allows flexibility across AC/DC of Division/ Range Superintendent/Range
Inspector to create DRC-07 and AC/DC of Division/ Range Superintendent to approve
DRC-07. Copy of the Order-in-Original based on which, such DRC 07 is created shall be
scanned and uploaded in the system for reference. To ensure accuracy in data entry, it
is proposed to have two level authentication. DRC-07 can be viewed by all the
jurisdictional officers.
c) The data entry of fields which are essential for DRC-07 and Liability register part II have
been made mandatory. However, it is advisable to enter all other fields also which will
be useful in generation of MIS reports.
d) A field Financial Year available in the functionality and is not a part of DRC-07 form but
is a mandatory field in GSTN API. The system automatically captures current financial
year for the purpose of this field. However, the functionality allows data entry for the
period from JULY 2017 up to the month of Order date (i.e., demand can be raised for
more than one financial year in a single DRC-07).
e) If the Order contains both CGST and SGST or UTGST, Tax officer has to add a new demand
row for each Act and applicable Rate of Tax has be to filled against each Act.
f) The taxes under CGST, SGST or UTGST, IGST and CESS have to be entered separately by
adding demand row for each Act, along with applicable rate of Tax. The system allows
entry of IGST and CESS for interstate supply/SEZ supply, CGST, SGST, IGST and CESS for
intrastate/SEZ supply and CGST, UTGST, IGST and CESS for intra-union territory supply.
g) In Demand Details tab, interest portion should be calculated as on the Order issued date.
And it is preferable to enter date of communication of the order as the Oder issue date.
h) As a DRC-07 creates a liability in the Liability ledger part II of a Tax payer, there no
rectification process to amend the wrongly raised DRC-07. So it is requested to fill the
mandatory fields with utmost care.
i) One field out of HSN/SAC is mandatory, however both the fields can be entered for
demands including goods and services.
j) Officers are required to attach copy of demand order along with every DRC-07. The
process of attaching document from AIO is available in the user manual.
k) Saved and not submitted applications will be available in the Draft DRC-07 menu item.
All the Approved DRC-07 are listed separately and once Demand id is created from GSTN,
the Approved DRC-07 list is amended incorporating demand id. There is an export to
excel utility available for the Approved DRC-07 list.
l) On submission of the DRC-07 to the GSTN through an API, a demand ID is generated with
a creation of liability in the Liability register part II (Other than returns related liability).
This demand ID and associated liability created in the ledger will be visible to the tax
payer as well as the tax officer consequent to the receipt of data from GSTN. This liability
allows the tax payer to make payment of duty, interest and penalty utilizing the balance
in his electronic cash and credit ledger. This payment updates the Liability register part
II and the same can be viewed by tax officer
m) It is to be noted that the system at present provides for liability ledger part II for
registered taxpayers only. Personal Penalty is not part of notified DRC-07 form, and

You might also like