New GST Form GST DRC-03A Simplifies Tax Demand Adjustment Process for Taxpayers

To facilitate this process, the Goods and Services Tax Network, in its 62nd GST Council, has proposed a new form called GST DRC-03A, through which taxpayers can adjust payments made towards GST demands that have not been accurately reflected in the electronic liability ledger. This new form, available on the GST portal, is designed to answer the concern of taxpayers who had paid through the DRC-03 form but afterwards found discrepancies in the due.

What is the GST DRC-03A Form?

It will help assess the amount paid against an outstanding GST demand order using the GST DRC-03A form. It is useful for partial or full payments made using the DRC-03 form without using the option of “Payment towards Demand.” This leads to a non-registration of the amount paid by the GST system against the related demand order, thereby causing discrepancies in the taxpayer’s electronic liability ledger.

For example, suppose a taxpayer has a demand of Rs 200 as GST and he has made some partial payment of Rs 50 on DRC-03 form then he shall be able to adjust that Rs 50 against the demand order whereby his net tax liability would decrease to Rs 150.

In one scenario, using the DRC-03A form has highlighted that the payments made by taxpayers through DRC-03 forms are not being reflected in the electronic liability ledger in the GST portal. This has largely been observed to occur when the payment mode chosen by the taxpayers is not correct-for example, using DRC-03 where the cause of payment shown is “Voluntary” or “Others,” when the taxpayers had the choice of using “Payment towards demand” available on the GST portal.

The advisory from GSTN has explained that in such situations, the system would not automatically update in the liability ledger of the taxpayer when a payment is made. A new form rectifies this anomaly. Through this new form, it is now possible to link a payment made through DRC-03 with its corresponding demand order and to update the liability ledger of a taxpayer accurately.

How GST DRC-03A Form is Beneficial for Taxpayers?

The new form is beneficial for various types of taxpayers:

1. Payments by the Taxpayer: If a taxpayer has already paid some partial payments against a GST demand and wants to pay the remaining due amount to be directed to the correct order, then the DRC-03A form can be used for that.

2. Taxpayers who made payments without including the demand order number: The taxpayers in this category make ad-hoc payments without using the demand order number. A DRC-03A form can be used to match the payment to the right demand order.

3. Taxpayers Under Recovery Actions: Taxpayers, while appealing against a GST demand order, can also use DRC-03A form to adjust their payments so as to cease recovery actions.

Well, the process is pretty simple and ensures proper recording of payments made against respective demand orders, thereby saving recovery actions.

How to Use the GST DRC-03A Form?

Filing the GST DRC-03A form is a simple process. Taxpayers must log into the GST portal and navigate to ‘My Applications’ under the ‘User Services’ tab. Once there, they can search for their previous DRC-03 form by entering the relevant form number. After finding the applicable form, taxpayers will need to input the following details:

• Date of filing
• Cause of payment
• Period from and to
• DRC-03 balance as on date

Next, they must select the relevant demand order number from the dropdown, which will display the outstanding demand details, including the demand order date, type, and the period covered. After cross-checking the details, taxpayers can click on “Adjustment of Demand” to complete the process.

Why File GST DRC-03A?

The payment adjustment process is going to become easier due to the introduction of GST DRC-03A, and it is supposed to reduce the mismatch of paid amounts in the liability ledger of taxpayers. It is considering an issue those taxpayers have found; the payments made by using the DRC-03 form were not connected with the respective demand orders.

The advisory further stated that failure to file DRC-03A would attract the recovery actions of Sections 78 and 79 of the CGST Act. Thus, it is important for taxpayers to facilitate adjusting their payments so their liabilities may be updated in the system.

Accordingly, the GST DRC-03A form allows for the simplification of adjustment of tax demands and develops a workable means of correction for taxpayers who made payments through the DRC-03 form without proper linkage to demand orders. The form also ensures payments are reflected correctly and reduces the chances of recovery actions by officials in charge of GST.