Section 73 versus 74
| Section | Used for | Penalty risk |
|---|---|---|
| 73 | Non-fraud error, short payment or ITC mismatch | Lower penalty and voluntary-payment benefits may apply. |
| 74 | Fraud, suppression or wilful misstatement allegation | Higher penalty exposure and longer limitation. |
Situations this page is built for
- SCN under Section 73 for ITC mismatch.
- Section 74 notice alleging fraud.
- Adjudication order confirming demand.
- Large ITC reversal demand.
- Want to pay and close lower-risk demand before escalation.
Documents required
- SCN with section and DIN.
- GSTR-1, GSTR-3B and GSTR-2B.
- ITC invoices and payment proof.
- Evidence transactions are genuine.
- Previous department correspondence.
Process
Read SCN
Identify section, period and demand.
Check facts
Reconcile books and returns.
Draft reply
Address each allegation point-wise.
Attend hearing
Submit documents and written submissions.
Appeal if needed
File within prescribed time if order is adverse.
Penalty structure needs strategy
Voluntary payment, timing of reply, fraud allegation and evidence quality can change penalty outcome. Section 74 should not be accepted blindly where fraud is not present.
GST Demand Under Section 73 and 74: year and source check
Last fact-checked: 25 May 2026.
AY 2026-27 means FY 2025-26 income under the Income-tax Act, 1961. Tax Year 2026-27 means FY 2026-27 income under the Income Tax Act, 2025. Do not mix the two labels.
Use official portal pages, CBDT notifications, the supplied Act PDF and ICAI material before making a filing, payroll, TDS/TCS or rebate decision.
FAQs
Which year should I use for GST Demand Under Section 73 and 74?
Use AY 2026-27 for FY 2025-26 income under the Income-tax Act, 1961. Use Tax Year 2026-27 for FY 2026-27 income under the Income Tax Act, 2025.
What documents should I share with a tax expert?
Share the portal screenshot, exact year, income breakup, certificates, AIS/Form 26AS, notices, challans and any computation already prepared.
Can WorkIndex help me find a specialist?
Yes. Post a requirement with the legal year, records and deadline so experts can quote on the real issue instead of a generic page title.
GST Demand Under Section 73 and 74: year and source check
Last fact-checked: 25 May 2026.
AY 2026-27 means FY 2025-26 income under the Income-tax Act, 1961. Tax Year 2026-27 means FY 2026-27 income under the Income Tax Act, 2025. Do not mix the two labels.
Use official portal pages, CBDT notifications, the supplied Act PDF and ICAI material before making a filing, payroll, TDS/TCS or rebate decision.
What to verify for GST Demand Under Section 73 and 74
- Correct financial year, assessment year or tax year.
- Taxpayer type, age category, residential status and business/profession status.
- Exact income heads, including salary, house property, business/profession, capital gains, VDA and other sources.
- AIS/TIS, Form 26AS, TDS/TCS certificates, challans and portal pre-fill.
- Deductions/exemptions allowed in the selected regime and current ITR utility validation rules.
- Whether the issue is a calculation, filing, notice response, rectification, appeal or advisory position.
GST Demand Under Section 73 and 74: year and source check
Last fact-checked: 25 May 2026.
AY 2026-27 means FY 2025-26 income under the Income-tax Act, 1961. Tax Year 2026-27 means FY 2026-27 income under the Income Tax Act, 2025. Do not mix the two labels.
Use official portal pages, CBDT notifications, the supplied Act PDF and ICAI material before making a filing, payroll, TDS/TCS or rebate decision.
What to verify for GST Demand Under Section 73 and 74
- Correct financial year, assessment year or tax year.
- Taxpayer type, age category, residential status and business/profession status.
- Exact income heads, including salary, house property, business/profession, capital gains, VDA and other sources.
- AIS/TIS, Form 26AS, TDS/TCS certificates, challans and portal pre-fill.
- Deductions/exemptions allowed in the selected regime and current ITR utility validation rules.
- Whether the issue is a calculation, filing, notice response, rectification, appeal or advisory position.