Additional GST via Form GST DRC-03

Monthly Archives: December 2021

Additional GST via Form GST DRC-03


What is Form GST DRC-03?

FORM GST DRC-03 is a digital intimation of payment made by the taxpayer voluntarily or made against show cause notice issued by the department or in adherence to section 142(2) and 142(3) of CGST Rules 2017. The tax officer is expected to verify the payment received from the taxpayer and if the amount paid falls short of the amount actually payable, they shall proceed to issue a notice in respect of such amount which falls short of. Accordingly, verification of DRC 03 payment is built in this module. Eligible individuals can view & download the Form GST DRC 03 in PDF format.

When a taxpayer is expected to make a payment through Form DRC-03? While making voluntary payment of outstanding liabilities u/s 73 and 74 of the CGST Act. A taxpayer can himself ascertain the tax before issuance of SCN or within 30 days of SCN determination to avoid the struggle of demand and recovery provisions. You cannot make voluntary payment after 30 days of issue of SCN. What are the pre-conditions to make voluntary payment? The pre-conditions to make voluntary payment are: Make voluntary payment before the issue of SCN or If voluntary payment is made after the issue of SCN or statement then 30 days’ time limit should not lapse since SCN is issued. What is the procedure to file DRC-03? There are mainly two steps to be performed to file DRC-03 Form – Step 1 – Login to GST Portal and then select User Services and go to MY Applications Step 2 – There are three cases under which a taxpayer makes payment Case 1: A taxpayer has not made any payment and does not have a payment Reference Number (PRN). Case 2: A taxpayer has generated PRN but is unutilized and comes for payment within 30 minutes of the generation of PRN. Case 3: A taxpayer has generated PRN and is unutilized and the taxpayer comes for payment after 30 minutes of the generation of PRN. Steps to be performed in Case 1 are as follows Step 1 – Select the Application Type as ‘Intimation of Voluntary Payment – DRC-03’ and then click ‘New Application.’ Step 2 – A taxpayer will get 2 options: Option 1: Voluntary payment: Payment date will be auto-populated without an option to edit. Option 2: Payment against SCN: A taxpayer has to manually enter SCN Number and select the issue date which must be within 30 days of making payment. To view your saved application, navigate to Services > User Services > My Saved Applications option. Step 3 – Choose the Section under which payment is being made, the Financial Year and then select the from date and to date of the overall tax period. Step 4 – Taxpayer should provide details of payment including the amount of interest and penalty. A taxpayer can provide additional details by clicking on ‘Add’. Then click on ‘Proceed To Pay’. Step 5 – Voluntary payment page will be displayed which will be divided into 3 sections: Liability Details: Liabilities are displayed in this table. Cash Ledger balance: The cash balance available as on a particular date is reflected in this table. The taxpayer has to enter the value of cash to be paid from the available balance against outstanding liabilities.   Credit Ledger balance: ITC available as on date is reflected in this table. The taxpayer has to enter the value of the liability to be paid through ITC and click Set Off. Step 6 – A confirmation message will pop up on the screen showing the balance of cash and ITC which is being used for making payment. By clicking ‘Ok’, a PRN will be generated along with a successful payment message. If PRN is not available, it can be extracted from the ‘Electronic Liability Register’ under Services>Ledgers>Electronic Liability Register. Step 7- There is a facility to view the draft DRC-03. Click the ‘Preview’ button on the page-‘Intimation of payment made voluntarily or against SCN’. Step 8 – Provide reasons if any, in the field provided. Choose a file in the attachments section to upload. Click on the verification checkbox and then select the ‘Authorised Signatory’ and enter the ‘Place’. Step 9- Click on ‘File’. Then two options will be available: Option 1 – File with DSC: Browse the certificate and click on the button ‘sign’. Option 2 – File with EVC: An OTP will be sent to the registered mobile number and email ID. On validation of OTP, a success message will be received along with ARN. Steps to be performed for Case 2 Step 1 – Follow the steps as mentioned in Case 1 till the taxpayer reaches on Intimation of payment made voluntarily or against the SCN page. Step 2 – Select ‘Yes’ for the option of Have you made payment? By entering the PRN. Step 3 – A link like ‘Get payment details’ will be displayed. Once the taxpayer clicks on it, details will be auto-populated on the basis of the respective payment that was made. GST Live Batch: Certificate from Ministry of MSME Govt of India 25th Live Batch begins 18th December, 2021 Weekend Batch: Saturday & Sunday | 7 PM to 10 PM 65 hours GST Course will be divided in 4 Modules Module 1 – Basic to Advance – 30 Hours (Live) Module 2 – GST Litigations & Drafting reply GST Notices/Appeal – 10 hrs (Live) Module 3 – Sector wise Analysis – 10 Hours (Recorded) Module 4 – GST Practical Return Filing – 15 Hours (Recorded) E-Notes for reference Live Interactive sessions with Real-Time Query Resolution Get Started Step 4 – Click on ‘Preview’ to view draft DRC-03 and then follow the same steps to file the application as mentioned in Case 1. Steps to be performed for Case 3 Step 1 – Follow the steps as mentioned in Case 1 till the taxpayer reaches on Intimation of payment made voluntarily or against the SCN page. Step 2 – Select Yes for the option – Have you made payment? and enter the PRN. Step 3 – A link, known as ‘Get payment details’ will be displayed. Click on the link and enter the details, since the details will not be auto-populated as mentioned in Case 2. This happens because the time limit of 30 minutes has passed. The processing will happen in the Back end, wherein the system will check whether the amount entered by taxpayer matches with the payment made. If yes, the intimation form will be accepted. If no, an error message will pop up. Step 4 – Then follow the same steps as mentioned in Case 1 for filing the application DRC-03. For Case 2 and Case 3 if the PRN is already utilized, an error message will be displayed asking the taxpayer to enter the unutilized PRN. Where to report cash payments in GST returns? Cash Payments in various GST returns are shown in the below manner: GST Return/Application Electronic Cash Ledger GSTR-3B(Monthly Return) Electronic cash ledger is an e-wallet. All payments made in cash/bank are reflected in this ledger. A taxpayer can first utilize his balance in ITC to pay tax liabilities. If the liabilities are greater than the balance in ITC, the same has to be paid in cash. GSTR-9 (Annually) Any balance tax liability if not paid while filing GSTR-3B needs to be paid while filing GSTR-9. Available balance in electronic cash ledger is used to make payment of outstanding liabilities. In case, the liabilities are higher than the available cash balance, a challan has to be created for making additional cash payment. In case of demand notices In case of demand notice, payment can be made by utilizing ITC and balance cash available in the Cash Ledger. The remaining liability needs to be paid in cash by creating additional cash challan. Interest and Penalty need to be compulsorily paid in cash. A proper officer will issue an acknowledgement in Form DRC-04 regarding the payment made in Form DRC-03 and the proceedings will be concluded by the Officer by issuing an order in Form DRC-05. Is partial payment allowed against a liability raised in an SCN? GST Portal does not allow for making partial payments against a liability raised in an SCN. Complete payment of the amount being demanded in SCN has to be made by the taxpayer. What will happen after Form GST DRC-003 is filed?

Once the form is successfully filled, the electronic liability register, electronic cash ledger and electronic credit ledger will automatically get updated. The entries will be posted and the PRN will get created automatically.

18% GST payable on Supply of Artwork along with Advertisement Space: AAR

GST on Print Media Advertisement

Short Summary

If Only Advertisement Space : 5% GST

If Only Artwork Creative Charges : 18% GST

If composite service : 18% GST on both

Now in Detail

The Telangana Authority of Advance Ruling (AAR) ruled that Supply of artwork along with advertisement space amounts to supply of ‘Other advertisement space’ and 18% GST is payable.

The applicant, M/s Time Education Kolkata Private Limited is in the business of purchase and supply of advertisement space to the prospective customers. In the course of supply of advertisement space they are also supplying artwork to adorn the space. They are desirous of ascertaining whether supply of artwork along with the space amounts to supply of advertisement space or other service.

The applicant has sought the advance ruling on the issue whether the services supplied by the applicant can be termed as the supply of space for advertisement in print media, If yes, 5%  GST can be charged on the invoices raised to the customers.

The coram of Raghu Kiran and S.V. Kasi Visweswara Rao ruled that the selling of space for advertisement in print media (SAC 998362) is taxable at the rate of 2.5% under CGST & SGST respectively. As against this the service for ‘Sale of other advertising space or time’ is enumerated as 998366 in the SAC given in the annexure to the notification.

This is not specifically mentioned in the serial no. 21 of the above notification. Clearly this service will fall under item (ii) of serial no. 21 i.e., other professional, technical & business services taxable at the rate of 9% under CGST & SGST respectively.

“The applicant is supplying (2) different services and each is attracting different tariffs under this notification. Therefore the question of deducing a composite supply from the combination of drafting a design and incorporating a space does not arise.

Hence where only space for advertisement and print media is supplied (SAC 998362) the rate of tax applicable is 2.5% under CGST & SGST respectively and where they are supplying ornate space it shall be treated as other advertisement space falling under item (ii) of serial no. 21 and accordingly will attract tax @9% under CGST & SGST respectively,” the AAR observed.

click here for detailed AAR Judgement Text


This is an important note for all the Advertisement companies. Going forward, you must bill for the Space and Creative separately.

Big Problem of “Vanishing” Vendors ( leading to Reversal of GST ITC with Intt @24% and Penalty )

Dear Members and Friends,

There is a Problem. Hence this Post.

This is regarding the recently rising Problem of “Vanishing” Vendors, leading to big losses in GST. And this problem is rising .

The information below is True and is with personal experience by us.

And this message is to help other LMAI members avoid this problem.

Vanishing Companies Includes (a) Those whose GST Registration is Struck off by the GST Dept (b) Those who are registered but are not filing GST Returns / filing them improperly

Every month, we are coming across cases of GST Audit by Department, and their insistence of GST-2A matching with your GST-3B.
If the difference is substantial, they ask for Detailed GSTR2A matching…. Even if this is not legally compulsory, Even if some High Courts have come in support of the Manufacturer/Trader, that he is not responsible for the mistake of non filing by the Vendor… but yet matter is being hotly debated.

The Above “addition” leads to Reversal of GST ITC with Intt @24% and about 15% Penalty

Points to Remember

Do a Regular Check of which Vendor is “OK” VALID and who is “Struck off” / “Cancelled” .. Every month / Every 3 months

Purchase Dept to listen to Taxation Department / Accounting Department / BPO .. and followup with Vendors for GSTR2A in-congruencies ….Every month / Every week

Tip of the day
In case you are facing problems in doing this, Finsys can help you do this, Advise is Free for LMAI members and in case you want us to do this on regular basis, then, Professional Support is also available with our 70+ staff including 12 Qualified CA’s and 2 Qualified CS and 20+ Software Engineers ,who can make your life safer from this GST Risk.



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