Answer

1. F

   Facts

   DRC-01A is a pre-show cause intimation that tells you the tax or credit the officer proposes to demand. You can accept and pay, or reply with your objections, before a formal show cause notice is issued.

2. P

   Provisions and law

   • Rule 142(1A), CGST Rules 2017Officer may communicate the proposed liability in DRC-01A before issuing a show cause notice
   • Sec 155, CGST Act 2017The burden of proving eligibility for ITC lies on the person claiming it
   • Sec 16(2)(c), CGST Act 2017ITC is allowed only if the tax charged has actually been paid to the Government by the supplier
3. A

   Analysis

   Your reply should prove that goods moved and were received and paid for. Attach e-way bills, transport receipts, goods receipt, stock records, bank proof, your portal check screenshot and the supplier's registration status on the invoice date. Example: for Rs 3.6 lakh credit, show that the supplier was active and filing on the invoice date. If part of the credit cannot be proved, pay that part with interest through DRC-03.

4. C

   Conclusion

   1. 1Read the DRC-01A and identify the supplier and invoices involved
   2. 2Gather the full proof file for those invoices
   3. 3Pay any amount you accept through DRC-03 with interest
   4. 4File a point-wise reply in Part B with documents and case law
   5. 5Keep the acknowledgement and follow up

General guidance from TaxSavvy’s library of money processes. Laws change; your Savvy confirms the answer on your exact case before anything is filed.