Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

DRC 04

888 views

Save Share

Dhana Sai

244 Points Posted on 18 April 2023

if we have both taxable and exempted supplies and common itc, so we applied rule 42 and reversed the same on exempted portion through DRC 03. department also issued drc 04 acknowledgement.

now my question is can dept ask explanation reg exempted supplies during any proceedings even after dept has acknowledged the payment....

Replies (3)

Quick Summary

This discussion clarifies the implications of a DRC-04 acknowledgement following the reversal of common Input Tax Credit (ITC) under Rule 42. The core question is whether tax authorities can later request explanations regarding exempted supplies once a DRC-04 has been issued. The consensus suggests that after the DRC-04 acknowledgement, the department generally cannot revisit the same matter, although officers might inquire during return scrutiny.