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CRITICAL SEVERITYSection 73/74 • CGST Act, 2017

GST Demand Order (DRC-07)

DRC-07 is the final order creating a tax demand after the show cause notice proceedings. Once issued, you must either pay or appeal within 3 months.

Quick Answer

DRC-07 is the final demand order issued after DRC-01 proceedings. It creates a legal tax liability. You must pay or appeal within 3 months to the Appellate Authority.

⏰ Deadline: 90 days💰 Penalty: Section 73: 10% (min ₹10,000)

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What is DRC-07 Notice?

DRC-07 is the Summary of the Final Order that creates a confirmed tax demand against you. It is issued after: 1. Show Cause Notice (DRC-01) was issued 2. You either didn't reply, or your reply was found unsatisfactory 3. Personal hearing was conducted (if requested) 4. The adjudicating authority passed the order

Once DRC-07 is issued: - The tax demand becomes a confirmed liability - Interest from the due date is added - Penalty as per Section 73/74 is confirmed - You have 3 months to file appeal (extendable by 1 month) - If you don't pay or appeal, recovery proceedings begin under Section 79

This is the most serious outcome of a GST proceeding. The amount shows in your "Electronic Liability Register" on the portal.

Why You Received DRC-07 Notice

  • •Non-reply to show cause notice DRC-01
  • •Unsatisfactory reply to DRC-01
  • •Confirmed tax evasion or suppression
  • •Wrong ITC claim upheld after hearing
  • •Ex-parte order due to non-appearance

How to Respond to DRC-07 Notice — Step by Step

  1. 1Download the complete order from GST portal immediately
  2. 2Note the exact demand amount (tax + interest + penalty)
  3. 3Calculate if appeal is viable based on merits
  4. 4File appeal in Form APL-01 within 3 months if you disagree
  5. 5Pay pre-deposit of 10% (Section 73) or 25% (Section 74) for appeal
  6. 6If not appealing, pay the full demand to avoid recovery proceedings

Documents Required for DRC-07 Reply

  • 📄Copy of DRC-07 order
  • 📄Original DRC-01 SCN
  • 📄Your DRC-06 reply (if filed)
  • 📄Personal hearing notes
  • 📄Evidence supporting your appeal grounds
  • 📄Challan for pre-deposit payment

Expert Tips for DRC-07 Reply

✅Don't delay — the 3-month appeal window is strict
✅File appeal even if partial relief is expected
✅Pay pre-deposit immediately to stay the recovery
✅Engage an advocate for appellate proceedings
✅Identify legal grounds — violation of natural justice, incorrect facts, wrong interpretation

Frequently Asked Questions About DRC-07

What is DRC-07 in GST?

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DRC-07 is the final demand order passed by the GST authority after show cause notice proceedings. It confirms the tax liability along with interest and penalty that you are required to pay.

How to appeal against DRC-07 order?

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File appeal in Form APL-01 to the Appellate Authority within 3 months (extendable by 1 month). You must pay a pre-deposit of 10% of disputed tax (Section 73) or 25% (Section 74) to file the appeal.

What happens if I don't pay DRC-07 demand?

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If you neither pay nor appeal within 3 months, the department initiates recovery proceedings under Section 79 — including bank account attachment, property seizure, or arrest in extreme cases.

Can DRC-07 be issued without personal hearing?

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If you requested a personal hearing and it was denied, the order can be challenged on grounds of violation of natural justice. However, if you didn't request one or didn't appear, the order is valid.

Related GST Notices

DRC-01high

GST Show Cause Notice (DRC-01)

Section 73high

GST Notice Under Section 73

Section 74critical

GST Notice Under Section 74 (Fraud)

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