Rectification of DRC-7 (Summary Order) under GST: A Comprehensive Guide

The taxpayer can submit an application for rectification of order in DRC-7 within 3 months from the date of issuance of the order.

Rectification of DRC-7 (Summary Order) under GST: A Comprehensive Guide

Under Rule 142(5) of the GST Rules, Form DRC-7 is issued electronically by the proper officer to recover GST dues from taxpayers. This form serves as a summary order after the final order has been issued under various sections of the CGST Act, such as Section 52, 62, 63, 64, 73, 75, 76, 122, 123, 124, 125, 127, 129, or 130. It specifies the amount of tax payable, including interest and penalties. Upon submission of DRC-7 to the GST Network (GSTN) via an API, a demand ID is generated, and the corresponding liability is recorded in Part II of the Liability Register (Other than returns-related liabilities).

DRC-8: Summary of Rectification or Withdrawal Order

Form DRC-8 is used by the proper officer to electronically upload a summary of a rectification or withdrawal order in DRC-7. This form is applicable when the officer opts to rectify or withdraw the final order previously uploaded in DRC-7. The rectification or withdrawal is carried out under Section 161 of the CGST Act. The rectified or withdrawn summary is then reflected in DRC-8.

Key Provisions for Rectification under Section 161

Section 161 of the CGST Act allows rectification of errors in DRC-7 that are apparent on the face of the record. This applies to any decision, order, notice, certificate, or document issued by an authority. Key provisions include:

1. Scope for Rectification:
   • The authority may rectify errors in DRC-7 either on its own motion or upon notification by:
     • An officer appointed under the CGST Act, State GST Act, or Union Territory GST Act.
     • The affected person.
2. Time Limits for Rectification:
   • Generally, rectification must be completed within 3 months from the date of issue of the decision, order, notice, certificate, or document.
   • However, for clerical or arithmetical errors resulting from accidental slips or omissions, no time limit applies.
3. Extended Time Limit for Clerical Errors:
   • Rectifications of DRC-7 purely related to clerical or arithmetical errors can be made at any time, as long as they stem from accidental slips or omissions.
4. Adherence to Natural Justice:
   • If rectification of DRC-7 order adversely affects any person, the authority must follow the principles of natural justice. This includes giving the affected person an opportunity to be heard.

How to File an Application for Rectification of Order in DRC-7 on the GST Portal

If you need to file an Application for Rectification of Order under DRC-7, this guide provides a step-by-step walkthrough. Follow these instructions to ensure a smooth submission process through the GST portal.

Steps to File the Application for Rectification of Order

1. Access the GST Portal
   • Visit the official GST website at www.gst.gov.in.
   • The homepage of the GST portal will appear.
2. Login to Your Account
   • Use your valid login credentials to access the portal.
3. Navigate to My Applications
   • After logging in, the Dashboard will be displayed.
   • From the top menu, navigate to Dashboard > Services > User Services > My Applications.
4. Initiate a New Application
   • On the My Applications page, select Application for Rectification of Order from the Application Type dropdown.
   • Click the NEW APPLICATION button to proceed.
5. Fill in the Application Details: The New Application page will open. Complete the form as follows:

i. Original Order Number

Select the order number you wish to rectify. The corresponding Original Order Issue Date and Tax Period fields will be auto-filled based on your selection.

ii. Grounds for Rectification

Provide a detailed reason for filing the rectification application in the Grounds for Rectification field.

iii. Document Upload (Optional)

Use the Choose File option to upload any supporting documents. This step is optional but recommended for relevant cases.

iv. Verification Details

Select the declaration checkbox and choose the name of the authorized signatory from the dropdown.

Upon selection, the Designation/Status and Date fields will auto-populate with the current date.

Enter the name of the place where the application is being filed.

v. Preview Your Application

Click PREVIEW to download and review your application before submission. Make any necessary changes.

vi. File the Application

Once satisfied, click FILE to proceed.

6. Submit the Application

On the Submit Application page, choose your preferred mode of submission:

SUBMIT WITH DSC (Digital Signature Certificate)

SUBMIT WITH EVC (Electronic Verification Code)

7. Acknowledgement

After successful submission, an Acknowledgement page will appear displaying the generated ARN (Application Reference Number).

To download the filed application, click the Click here hyperlink. You can also initiate a new application by selecting CREATE NEW APPLICATION to return to the My Applications page.

Post-Submission Updates on the GST Portal

Once the application is successfully filed, the following actions occur automatically on the GST Portal:

• The status of the application is updated to “Pending for action by tax officer”.
• You will receive an intimation of successful filing along with the ARN on your registered email and mobile number.
• You can view and track your application using the following path: Dashboard > Services > User Services > My Applications > Case Details > APPLICATIONS.

FAQs on Rectification of DRC-7

1. How Can Errors in Decision, Order, Notice, Certificate, or Document Be Rectified?

Rectification of errors apparent on the face of the record can be initiated by the authority responsible for the original decision, order, notice, or certificate. This can be done:

• Suo Moto: On the authority’s own motion.
• On Request: When such an error is brought to their attention by a tax official or the affected individual.

2. What Is the Time Limit for Filing a Rectification Application?

The taxpayer must submit the rectification application within three months from the date of issuance of the order.

3. Can I Apply for Rectification of if I Have Filed an Appeal?

No, you cannot file a rectification application for an order if an appeal has already been lodged against it.

4. What Happens if Suo Moto Rectification Adversely Affects a Person?

If a suo moto rectification by the Adjudication Authority (A/A) negatively impacts an individual, the A/A must:

• Provide an opportunity for the individual to be heard.
• Issue an “Additional Information” notice to the concerned taxpayer.
• Conduct a personal hearing before issuing the rectification order.

5. How Will I Be Notified About a Suo Moto Rectification, and Where Can I View It?

If a suo moto rectification is carried out on any order (Ref. No.), you will be notified via:

• Email
• SMS

To view the issued order or notice on the GST portal, navigate to: Services > User Services > View Additional Notices/Orders

6. What Is the Procedure for Rectification of an Order?

The rectification process involves the following steps:

• Application Filing: The taxpayer files an application for rectification, or the A/A initiates suo moto rectification.
• Suo Moto Rectification:
  • If the rectification doesn’t adversely affect the person, the A/A rectifies and issues the order.
  • If the rectification adversely affects the person, further steps (3–6) are followed.
• Notice Issuance: The A/A issues a notice seeking additional clarifications. If personal hearing is required, date/time/venue details are provided.
• Taxpayer Response:
  • Taxpayer may reply to the notice and request a personal hearing (if not already scheduled).
  • Taxpayer may request an extension offline, which the A/A may approve up to three times.
    • If approved, the A/A issues an adjournment with a new hearing schedule.
    • If not approved, the taxpayer must reply by the due date.
  • Follow-Up:
    • If no reply is received, the A/A can issue up to three reminders. If no response is received even after reminders, the A/A may proceed with rectification and issue the order.
    • If a reply is received, the A/A examines it and conducts the personal hearing (if scheduled).
  • Final Order: The A/A rectifies the order based on the reply and hearing outcomes and issues the rectified order.

7. What Is the Time Limit for Completing DRC-7 Rectification Proceedings?

• General Cases: The rectification order must be issued within six months from the date of the original order.
• Clerical/Arithmetical Errors: Rectification orders for clerical or arithmetic mistakes can be issued even after six months.

8. What Happens on the GST Portal After Filing a Rectification Application?

Once you file a rectification application:

• An Acknowledgment Screen with a generated ARN is displayed.
• Intimation of successful filing is sent to your registered email and mobile.
• You can track the ARN via: Dashboard > Services > User Services > My Applications > Case Details > APPLICATIONS

9. What Documents Will I Receive Upon Notice Issuance?

You will receive:

• A System-Generated Notice seeking clarification.
• Any annexures uploaded by the officer.

10. What Happens on the GST Portal After Filing a Reply?

Once your reply is filed:

• The “Notices and Orders” page displays the Reference Number (RFN).
• You receive a confirmation via email and SMS.
• The Replies Tab updates the status to “Reply furnished, Pending for rectification order.”

11. What Happens on the GST Portal When a Rectification Order Is Issued?

If the rectification order is issued:

• The taxpayer is notified via email and SMS.
• The order is available on the dashboard for viewing, printing, and downloading.
• The Electronic Liability Register and DCR are updated.
• For taxpayer applications, the ARN/RFN status changes to “Order rectified.”

12. What Happens on the GST Portal if a Rectification Application Is Rejected?

If the application for rectification of order in DRC-7 is rejected:

• A “Rejection of application for rectification” notice is issued.
• Notifications are sent via email and SMS.
• The order is accessible on the taxpayer’s dashboard for viewing, printing, and downloading.
• The ARN status updates to “Application rejected.”

Conclusion

The process of rectifying or withdrawing DRc-7 orders ensures transparency and accuracy in tax administration. Taxpayers and authorities must be vigilant in identifying errors and leveraging the provisions under Section 161 for timely corrections. Proper utilization of forms like DRC-7 and DRC-8 helps streamline compliance and resolve disputes effectively.

FAQs on DRC-7

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