What is DRC-05 in GST: Intimation of Conclusion of Proceedings

The taxpayer and tax officer use DRC forms to communicate with each other for demand and recovery proceedings. In this article, we discuss Form DRC 05 in GST in detail. 

What is Form DRC 05 in GST? 

The tax officer issues Form DRC-05 intimates the conclusion of an ongoing demand and recovery-related proceeding.

It shows that the business has paid the tax dues, including the interests and penalties mentioned in the original notice, and a competent tax officer has confirmed receipt of the payment on behalf of the GST authority.

Once DRC-05 has been issued, GST officers cannot issue another section 73 or 74 DRC-01 notice for another 3 to 5 years.

When and why is DRC-05 applicable?

As per the rule 142 (3) under the CGST Act, the issuance of DRC-05 is applicable when a business has made the payment in total as per previously issued demand and recovery notice.

The Rule 142 (3) states:

For example, assume a competent tax officer has issued a show cause notice (DRC-01) regarding under-recovery or overpayment of ITC.

The business needs to reply to the notice within 7 working days from the date of receiving the notice. The said business can explain the reasons behind the mismatch in the input tax credit in the DRC-01 Part B format. This reply will lead to a tax proceeding between the concerned tax officer and the business. 

If the demands are found to be legitimate as per the GST Act, the business will have to make the requisite payments covering tax dues, interests, and penalties, if applicable. 

Upon making the payment, they need to inform the competent officer in DRC-03 to verify the payment. The officer will verify receiving the payment to the satisfaction of the GST department and issue DRC-05 to the business as proof of ending the demand proceeding.    

How to file DRC-05 in GST? 

DRC-05 is issued by a competent GST officer. The business files DRC-03 to intimate the authority that tax dues, along with applicable interests and penalties, have been paid voluntarily. The concerned officer checks the GST portal at their end to verify the payment. Once the payment is verified, the officer issues a DRC-04 as an acknowledgement of receiving the payment and a DRC-05 to end the ongoing proceeding.  

How to check DRC-05 in the GST portal? 

A competent GST officer issues DRC-05 from their end of the GST portal. As a GSTIN holder, you can check the certificate and download it by logging into the GST portal with your username and password. 

• Step 1 - Login to GST portal 
• Step 2 - Open the Dashboard  
• Step 3 - Click SERVICES > User Services 
• Step 4 - Check My Applications 

How to download DRC 05 in GST portal? 

Once issued, DRC-05 will remain saved online as proof of an end to the DRC proceeding. Open the document to download and save it in your personal system. 

Penalties for failure to file DRC-05

Form DRC-05 in GST is an intimation that informs an end to an existing demand and recovery proceeding. Only a competent tax officer can issue DRC-05. As long as DRC-05 is not issued, the respective demand and recovery proceedings remain active despite the payment of dues by the business. 

So, a failure to secure form DRC-05 from the concerned officer keeps the business vulnerable to further DR proceedings, as per Section 73 or Section 74. Following a prolonged delay in issuance of DRC-05, the GST portal may automatically disrupt filing of GST return at the taxpayers’ end.

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