show- cause notice limitaion for 2017-18 18-19

[giri gattupalli]

respected sir,

department is issuing intimation letters to taxable persons relates to FY 2017-18 ,2018-19 in respect of differences between GSTR-1 data and GSTR-3B data and asking for explanation. and notices are giving under SEC-74 . my doubt is whether , issues relates to differences between GSTR-1 and GSTR-3B covered under sec-74 notices or not . please guide me

thanking you

[KASTURI SETHI]

The difference or mismatching of figures between GSTR-1 and GSTR-3B is very serious matter. However, this may be happening due to delay in filling GSTR-1 by the suppliers. The books of account is very much basis. If your client's transactions are genuine, there is nothing to worry. You are to justify the difference to the concerned officers with the books of account. Yes, Section 74 can be invoked in the SCN because the difference may be due to misdeclaration of figures in GST returns. Only scrutiny of the records by the department will clear the picture.

[Padmanathan KV]

The onus is on dept to prove that there is fraud/ suppression/ misstatement with intention to evade tax. What is the specific allegation for invoking section 74 in the SCN?

[KASTURI SETHI]

Undoubtedly indeed. 

[Shilpi Jain]

You have no choice but to reply to those notices and make submissions to support your stand of no suppression. Filing a Writ for this is not advisable since Courts would not entertain these kind of issues which can rather be taken up in adjudication.

AI Summary

GSTR-1/GSTR-3B mismatches may attract Section 74 scrutiny; respond promptly with books to rebut fraud allegations. Differences between GSTR-1 and GSTR-3B can be legitimate due to timing or delayed supplier filings; taxpayers should rebut departmental intimation under Section 74 by producing books of account and reconciliations. While Section 74 may be invoked if the department alleges fraud or suppression, the department bears the burden of proving intent to evade tax. Taxpayers must respond to show-cause notices with documentary evidence rather than seek writ relief.