GSTN Advisory, dated 14-03-2026
The Goods and Services Tax Network (GSTN) has issued an advisory clarifying the treatment of payments made during investigation through Form GST DRC-03 when filing an appeal before the First Appellate Authority.
The clarification addresses practical issues faced by taxpayers where such payments are not automatically reflected against demand orders on the GST portal.
1. Creation of Demand ID and Adjustment of Payments
When a demand order (e.g., Form GST DRC-07) is issued:
- A Demand ID is generated in Part II of the Electronic Liability Register.
- Payments made using the ‘Payment towards Demand’ functionality are automatically adjusted against this Demand ID.
However:
- Payments made through Form GST DRC-03 (typically during investigation) are not automatically linked to any Demand ID.
- As a result, such payments do not appear as adjusted in the Electronic Liability Register.
2. Impact on Filing of Appeals
While filing an appeal:
The GST system automatically calculates the required payment, which includes:
- The admitted amount, and
- The mandatory pre-deposit
The system checks payments already reflected against the Demand ID in the Electronic Liability Register.
Accordingly:
- If the amount already reflected is equal to or more than the required amount, the appeal can be filed without further payment.
- If it is less, the taxpayer must pay the balance amount.
Since DRC-03 payments are not auto-linked, the portal may continue to prompt for pre-deposit, even if payment has already been made.
3. Requirement to File Form GST DRC-03A
To ensure proper recognition of payments made through DRC-03, taxpayers are required to:
File Form GST DRC-03A to link the payment with the relevant Demand ID.
Once linked:
- The payment will be reflected in the Electronic Liability Register, and
- It will be considered while calculating the mandatory pre-deposit for appeal filing.
4. Advisory to Taxpayers
GSTN has advised taxpayers to:
- File Form GST DRC-03A wherever applicable, and
- Ensure such linking is completed before filing an appeal
so that payments already made are appropriately recognised and unnecessary additional payment is avoided.
5. Objective of the Advisory
The advisory aims to:
- Resolve practical issues in the GST portal relating to payment adjustment
- Ensure correct computation of pre-deposit requirements
- Facilitate smooth filing of appeals
- Improve accuracy and transparency in the Electronic Liability Register system
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