Is issuance of DRC 01A mandatory

[Deepak Kothari]

Can we for once interpret that DRC-01A is obligatory?, section 74A(8) or 74A(9) provides waiver of penalty on paying tax and interest as ascertained by the proper officer before issuance of notice, hence the logical means of communicating the tax ascertained by the proper officer is DRC-01A? would like to know experts opinion on this.. Thank you  

[Sadanand Bulbule]

Though not expressly mandatory, issuance of DRC-01A is implicitly obligatory, as Sections 74A(8)-(9) require prior communication of tax ascertained by the PO to meaningfully enable penalty waiver  before SCN.

AI Summary

Requirement for issuing DRC-01A to communicate ascertained tax amount for penalty waiver u/ss 74A(8)-(9) Whether issuance of DRC-01A is mandatory centers on sections 74A(8) and 74A(9), which prescribe waiver of penalty where the taxpayer pays the tax and interest 'as ascertained by the proper officer' before issuance of notice; this establishes that the proper officer must communicate an ascertained tax amount prior to notice, and the operative effect is that taxpayers can obtain penalty waiver only upon payment of the specific amount so communicated. The question raised is whether the prescribed communication must take the form of DRC-01A as the formal instrument of that ascertaining and communication.