GST WEEKLY UPDATE : 14/2023-24 (02.07.2023) By CA Vipul Khandhar

-By CA Vipul Khandhar

1. Advisory On Online Compliance Pertaining to Liability / Difference Appearing in R1 – R3B (DRC-01B):

• It is informed that GSTN has developed a functionality to enable the taxpayer to explain the difference in GSTR-1 & 3B return online as directed by the GST Council. This feature is now live on the GST portal.
•  The functionality compares the liability declared in GSTR-1/IFF with the liability paid in GSTR-3B/3BQ for each return period. If the declared liability exceeds the paid liability by a predefined limit or the percentage difference exceeds the configurable threshold, taxpayer will receive an intimation in the form of DRC-01B.
• Upon receiving an intimation, the taxpayer must file a response using Form DRC-01B Part B. The taxpayer has the option to either provide details of the payment made to settle the difference using Form DRC-03, or provide an explanation for the difference, or even choose a combination of both options.
• To further help taxpayers with the functionality, a detailed manual containing the navigation details is available on the GST portal. It offers step-by-step instructions and addresses various scenarios related to the functionality. The link is stated below:

When can form DRC-01B be filed?

The system checks the spike between the liability declared in form GSTR-1/IFF and the liability paid in GSTR-3B/3BQ for each return period. If the liability declared in GSTR-1 exceeds the liability paid in Form GSTR-3B by a pre-defined limit for a return period or the percentage difference between the liabilities declared in GSTR-1 exceeds the configurable percentage threshold from the liability paid in Form GSTR-3B for a return period, an intimation is sent to you.

Once you receive an intimation in Form DRC-01B, i.e., if there is a difference between the liability declared in GSTR-1/IFF and that paid through GSTR-3B/3BQ beyond the configurable threshold limit, you need to submit your reply in Form DRC-01B Part B.

Note: If a taxpayer doesn’t file response to Form GST DRC-01B for previous tax period, then for the subsequent tax period, they will not be able to file their Form GSTR-1/IFF.

On which class of taxpayers is form DRC-01B applicable?

Form DRC-01B is applicable to various types of taxpayers, including regular taxpayers (including SEZ units and SEZ developers), casual taxpayers, and taxpayers who have opted in or opted out of the composition scheme.

I have not filed the form DRC-01B for the previous tax period. Can I still file GSTR-1/IFF for the current tax period?

If you have not filed Form DRC-01B Part B for any period for which you received an intimation in Form DRC-01B Part A, you will not be able to file GSTR-1/IFF for the subsequent period. It is important to ensure timely filing of Form DRC-01B Part B to avoid any interruptions in the filing of GSTR-1/IFF.

How will I be intimated that I have to submit reply in Form DRC-01B Part-B?

Once the intimation in Form DRC-01B Part A is generated, a Reference Number will be assigned. You will receive the intimation via email and SMS, which will include the Reference Number. Please ensure to check both your email and mobile messages for the intimation and keep the Reference Number handy for future reference and correspondence.

Note: You can also check this intimation on GST Portal. Navigate to Services > Returns > Return Compliance > Liability Mismatch DRC-01B.

Can form DRC-01B Part B be filed monthly or quarterly?

For quarterly filers (QRMP), Form DRC-01B will be generated, if applicable, after filing the quarterly GSTR-3B. On the other hand, for monthly filers, Form DRC-01B will be generated on a monthly basis after filing the monthly GSTR-3B. Therefore, Form DRC-01B Part B can be filed either on a monthly or quarterly basis, depending on the frequency of filing GSTR-3B.

After filing the reply for DRC-01B Part-B, how much time will it take to unblock the form GSTR-1/IFF? When will I be able to file GSTR-1/IFF?

After filing the reply for DRC-01B Part B, you can instantly file GSTR-1/IFF. If you are facing any issue while filing GSTR-1/IFF, then you need to log out and log in again after a few minutes.

While entering the ARN for filing the reply for DRC-01B Part B, I am getting an error message stating that “Please provide valid ARN of DRC-03”. Why am I getting this error message?

If you encounter an error message while entering the ARN to file the reply for DRC-01B Part B,  please check the following points:

• Ensure that the ARN is valid and corresponds to the same DRC-03 and
• The DRC-03 should have been filed on or after the date when DRC-01B Part A was
• Confirm that the cause of payment specified in the DRC-03 is “Liability mismatch – GSTR- 1 to GSTR-3B.”
• The overall tax period should align with the period for which DRC-01B Part A was
  • For monthly filers, the period should be the same, including both the “From” and “To”
  • For quarterly filers, it should cover at least one month within the

How can I deselect any reason for the payment difference, after providing the details for the reason selected earlier?

If you deselect any reasons for difference after providing the details, the system will display an error message, requesting for deletion of details already provided. So, after deleting the details entered for the reason selected earlier, you will be able to deselect that reason.

Manual> Return compliance in form DRC-01B (intimation of difference in liability reported in statement of outward supplies and that reported in return)

If there is a difference between the liability declared in GSTR-1/IFF and the amount paid through GSTR-3B/3BQ that exceeds a pre-defined limit, you will receive an intimation in Form DRC-01B. In such cases, it is mandatory to file Form DRC-01B Part B to provide the necessary details and reconcile the difference.

Note: If you do not file response of DRC-01B Part B, then you will not be able to file GSTR-1/IFF for the subsequent Tax period.

How can I file form DRC-01B Part-B?

To file the Form DRC-01B Part B, please follow the steps below:

1. Access the GST portal by visiting gst.gov.in. The GST home page will be displayed.
2. Login to the GST Portal using your valid
3. Navigate to Services > Returns > Return Compliance option. Alternatively, you can directly click on the Return Compliance link available on the
4. The Return Compliance page is In the Liability Mismatch (DRC-01B) tile, click the VIEW button.
5. The Liability Mismatch (DRC-01B) page is The pending records will be displayed. Click the Reference number hyperlink.

      Note: Alternatively, you can click any one option from Reference number, Return period or Status to search for the intimation DRC-01B which is issued to you.

Case 1: If you click the Reference number option, then enter the ARN and click the SEARCH button. You will get all the completed and pending records list.

If the status for the record is pending, then you can file the Form DRC-01B.

Case 2: If you click the Return period option, then you need to select the Financial Year for which you need to file DRC-01B and Return period from the drop-down list. Click the SEARCH button. You will get all the completed and pending records list.

If the status for the record is pending, then you can file the Form DRC-01B.

Note: Return period option will get enabled only after you select the Financial Year.

Case 3: If you click the Status option, then you need to select the status Pending or Completed from the drop-down list and click the SEARCH button.

If you select Pending status, then pending records will be displayed. For the Pending record, you can file the Form DRC-01B.

If you select the Completed records, then the completed records will be displayed.

The Liability Mismatch (DRC-01B) details page with PART-A and PART-B will be displayed. PART-A will display the Intimation of Difference in Liability Reported in Statement of Outward Supplies and that Reported in Return.

In PART-B Reply by Taxpayer in Respect of the Intimation of Difference in Liability, there are two sub-parts. In part 1, you can provide the ARN of the payment which is made via DRC-03 for the period for which DRC-01B has been issued to you.

You can also make the payment for the Difference in Liability Reported by clicking the CLICK HERE FOR DRC-03 button. In part 2, you can select the Reason for the Difference in Liability Reported and provide further explanations in the text box.

Note 1: You can click the DOWNLOAD DRC-01B PART-A button to download the DRC-01B PART A form.

Note 2: The system generated PDF for DRC-01B PART A will be downloaded.

2    The Goods and Service Tax Network (“GSTN”) enabled the new facility to withdraw the appeal application introduced for Taxpayers, in case there are errors in the appeal application:

1. Withdraw the Refund Application in case you have made a mistake while filing
2. Fill out a simple Form RFD-01W to withdraw
3. File the Corrected Refund Application immediately for quicker processing

Can be withdrawn up to the stage of acknowledgement of application in Form RFD-02

3. GSTN enabled the Online facility for Taxpayers to track status of refund application in real time:

The Goods and Service Tax Network (“GSTN”) enabled the Online facility for Taxpayers to track the status of refund application in real time.

→ Red

→ Current Status shown in Red

→ Green

→ Completed stages shown in Green

→ Grey

→ Pending stages shown in Grey

Navigate services > Track Application Status > Select the Refund option > Enter ARN > click SEARCH.

Disclaimer:

This publication contains information for general guidance only. It is not intended to address the circumstances of any particular individual or entity. Although the best of endeavour has been made to provide the provisions in a simpler and accurate form, there is no substitute to detailed research with regard to the specific situation of a particular individual or entity. We do not accept any responsibility for loss incurred by any person for acting or refraining to act as a result of any matter in this publication.

THANKING YOU.