Show cause notice u/s 74 (fraud alleged): how to reply
Audit/scrutiny findings, FY ≤ 2023-24, fraud/wilful misstatement/suppression alleged
- Section
- 74
- Form names
- DRC-01
- Time to reply
- As specified in the notice. Paying tax, interest and 25% penalty within 30 days of issue concludes the notice (s.74(8))
- Reply goes on
- FORM GST DRC-06: Reply to show cause notice
What the notice is
Audit/scrutiny findings, FY ≤ 2023-24, fraud/wilful misstatement/suppression alleged
Filed through GST portal: Services > User Services > View Notices & Orders.
Time limit to reply
As specified in the notice. Paying tax, interest and 25% penalty within 30 days of issue concludes the notice (s.74(8)). Set by the statute or rules; counted from service.
- Adjournment is for the officer (s.75(5)); not computed here.
- Order time limits for FY 2017-18 to FY 2023-24 were extended by notifications under s.168A and by the Finance (No. 2) Act 2024; those dates are not encoded here.
- Order within 5 years from the due date of the annual return for the financial year (s.74(10)); the notice must issue at least 6 months before that date (s.74(2)).
Unverified: This is to be confirmed against the notified text.
Not confirmed
- Extended limitation dates for FY 2017-18 to FY 2023-24 (notifications under s.168A and the Finance (No. 2) Act 2024). No date is computed for FY 2019-20 and earlier; for FY 2020-21 to FY 2023-24 only the unextended statutory date is shown.
- Annual return due dates other than the 31 December default of s.44(1) are not encoded; supply the due date if it was extended.
Basis: CGST Act 2017, s.74; CGST Rules 2017, rule 142; CGST Act 2017, s.44 (annual return due 31 December). Rule last reviewed 2026-10-02.
Prescribed reply form
FORM GST DRC-06: Reply to show cause notice, filed through GST portal: Services > User Services > View Notices & Orders.
Unverified: The field list of this form is to be confirmed against the notified text.
What the reply must include
- direct rebuttal of the fraud/wilful-suppression allegation on the intent-to-evade standard
- demand for the specific material evidencing intent to evade tax
- Instruction 05/2023 point on mechanical invocation of s.74 without a fraud finding
- without-prejudice submissions on quantum even while denying fraud
Reply outline
Everything under the s.73 template applies, plus the fraud allegation must be rebutted head-on: the department must establish wilful suppression or misstatement with intent to evade tax, mere non-payment or a bona fide interpretational dispute is not fraud. Demand the specific evidence of intent the SCN relies on; a s.74 SCN issued mechanically without any such finding is itself a ground for challenge per Instruction 05/2023. Argue quantum in the alternative even while contesting fraud, and verify any Supreme Court citation on the intent standard against a supplied source before naming it.
Preliminary objections
Limitation, DIN/RFN validity, vague SCN, and (for s.74/74A) absence of fraud per Instruction 05/2023.
Facts
Registration, tax period, and the audit/scrutiny findings the SCN is founded on.
Issue-wise submissions
One sub-heading per demand item with reconciliation and supporting documents.
Quantification
Tax/interest/penalty computation contested or accepted, split CGST/SGST/IGST/cess.
Prayer
Request the demand be dropped, or reduced to the amount accepted.
Hearing request
Personal hearing is mandatory under s.75(4), request a date.
FAQs
What is a Show cause notice u/s 74 (fraud alleged)?
Audit/scrutiny findings, FY ≤ 2023-24, fraud/wilful misstatement/suppression alleged
What is the time limit to reply to a Show cause notice u/s 74 (fraud alleged)?
As specified in the notice. Paying tax, interest and 25% penalty within 30 days of issue concludes the notice (s.74(8)). To be confirmed against the notified text. Set by the statute or rules; counted from service.
How is the reply to a Show cause notice u/s 74 (fraud alleged) filed?
On FORM GST DRC-06: Reply to show cause notice, through GST portal: Services > User Services > View Notices & Orders.
What should the reply include?
Direct rebuttal of the fraud/wilful-suppression allegation on the intent-to-evade standard; Demand for the specific material evidencing intent to evade tax; Instruction 05/2023 point on mechanical invocation of s.74 without a fraud finding; Without-prejudice submissions on quantum even while denying fraud.
14 days free · No card required
This page summarises the notice type for chartered accountants and is not legal advice. Check the notice and the notified text before you file.