Demand and recovery procedures are crucial for Goods and Services Tax (GST) compliance. These processes address tax claims, rectify input tax credit discrepancies, and confirm voluntary tax payments by businesses. The GST framework includes various demand and recovery forms, such as DRC-04. This document provides essential information about Form DRC-04 for taxpayers.

What is GST Form DRC-04?

Form DRC-04 serves as an official acknowledgment that a taxpayer has voluntarily settled their tax liabilities. After verifying the payment details, authorized GST officers generate and issue the DRC-04 form through the GST portal. This verification process ensures that the voluntary payment covers the entire amount of outstanding dues. Should a taxpayer's voluntary payment fall short of the department's assessment, the GST officer will issue a revised notification. However, if the payment aligns perfectly with the demanded amount, the officer will confirm full receipt of funds and issue DRC-04.

Applicability of DRC-04

Form DRC-04 becomes relevant immediately after a taxpayer voluntarily settles their outstanding tax amounts using Form DRC-03 on the GST portal. Consider the following sequence of events:

1. A GST officer identifies a discrepancy in a taxpayer's GST payment for a particular GSTIN and subsequently issues a Show Cause Notice (SCN) via Form DRC-01.
2. The system informs the taxpayer of the SCN, who then proceeds to download DRC-01.
3. The taxpayer reviews the notice to comprehend the basis of the demand. If the taxpayer disputes the notice, they can respond through the GST portal, ensuring all necessary supporting documents are attached.
4. Conversely, if the taxpayer accepts the notice, they settle the demanded dues and inform the relevant office using Form DRC-03. The competent officer then receives notification of the DRC-03 submission.
5. The officer subsequently verifies whether the payment, including any applicable interest and penalties, corresponds to the claimed amount. If the voluntary payment aligns with the assessed value, the officer issues DRC-04 as an acknowledgment of the payment.

How to Process DRC-04 in GST

The process for issuing DRC-04 on the GST portal focuses on verifying the taxpayer's submitted payment. This verification task will appear in the task list of the designated GST officer or inspector. Following initial payment verification, the officer or inspector must access the DRC-03 notification via its hyperlink. This action opens the DRC-03 form for review, allowing the officer to note all payment specifics. The subsequent step involves selecting 'Verify Payment' located under the 'Actions' tab, which presents various verification criteria. The officer is required to address these parameters. If all system-generated checks confirm that the full tax dues, as outlined in the initial SCN, have been paid, the option to generate DRC-04 will become available on the GST portal. At this juncture, the GST officer or inspector proceeds to issue DRC-04 through the portal. Once issued, the system automatically notifies the business, enabling the taxpayer to view and download the form.

How to View DRC-04 on the GST Portal

Taxpayers can access Form DRC-04 directly on the GST portal. This acknowledgement from the GST authority is typically displayed under the 'ACKNOWLEDGEMENT' section within the taxpayer's personal dashboard on the GST portal.

How to Download DRC-04 from the GST Portal

To download the DRC-04 acknowledgment, taxpayers simply need to click the 'Download' link that appears next to the respective acknowledgment notice on the GST portal.