GST Notice ASMT-10: Return Scrutiny, 8 Discrepancy Types, and How to Reply via ASMT-11

As of 2026, the GSTN processes over 2.5 crore GSTR-3B returns annually and cross-matches them against GSTR-1 data, GSTR-2B auto-populated ITC, e-way bill portal data, e-invoice (IRP) data, and external sources including ICEGATE (customs), TDS returns, and TCS data. When the system or a Proper Officer identifies a discrepancy between what a registered taxpayer declared and what the data sources show, the officer issues Form GST ASMT-10 under Section 61 of the CGST Act 2017 read with Rule 99(1) of the CGST Rules, informing the taxpayer of the specific discrepancy and seeking an explanation. You must file Form ASMT-11 within 30 days of receiving ASMT-10 (or such extended period as allowed by the officer), either explaining why the discrepancy does not represent a tax shortfall, or acknowledging it and paying the differential tax via DRC-03. If the explanation in ASMT-11 is satisfactory, the officer closes the scrutiny by passing Form ASMT-12 with no further action. If unsatisfactory, the officer may initiate a GST audit under Section 65, a special audit under Section 66, a search or inspection under Section 67, or a demand notice under Sections 73 or 74 of the CGST Act. This guide explains the 8 most common ASMT-10 discrepancy types, how to structure the ASMT-11 reply for each, when to pay via DRC-03 rather than contest, and how to avoid escalation to the more disruptive investigation and demand stages.

What Is Form GST ASMT-10 and Why Did You Receive It?

Form GST ASMT-10 is the statutory notice issued by the Proper Officer under Rule 99(1) of the CGST Rules 2017 (rules available on the CBIC website) to inform a registered taxpayer of discrepancies found during scrutiny of their GST returns. Section 61(1) of the CGST Act authorizes the officer to scrutinize any return and the related particulars furnished by a registered person. If the scrutiny reveals a discrepancy, the officer communicates the discrepancy to the taxpayer through ASMT-10 and gives them an opportunity to explain. This opportunity is the core procedural protection under Section 61: the officer cannot proceed directly to demand or audit without first issuing ASMT-10 and waiting for the ASMT-11 response.

Receiving ASMT-10 does not mean a demand has been raised or that fraud has been alleged. It is an administrative notice at the scrutiny stage, well before the demand (DRC-01) or investigation (Section 67) stage. The officer is essentially saying: “The data we have from multiple sources does not match what you declared. Please explain the difference.” A well-prepared ASMT-11 reply can close the scrutiny entirely without further proceedings. ASMT-10 notices are typically accessible on the GST portal under Services > User Services > View Notices and Orders.

The Section 61 scrutiny form sequence is as follows:

ASMT-10 is distinct from the provisional assessment forms (ASMT-01 through ASMT-09 under Section 60) which are initiated by the taxpayer to resolve uncertainty about rate or value. The ASMT-02 guide and ASMT-06 guide cover the provisional assessment framework. This article covers only Section 61 scrutiny.

What Triggers an ASMT-10 Scrutiny Notice Under Section 61?

ASMT-10 notices are generated through two pathways: automated analytics by the GSTN Risk Management System, and manual scrutiny by the Proper Officer. Both pathways use the same underlying data: the multiple streams of return and transaction data that the GST ecosystem captures.

Automated Risk-Based Scrutiny

The GSTN operates a Risk Management System (RMS) that scores each taxpayer’s returns against a risk matrix and flags high-risk cases for scrutiny. The RMS compares return data against: GSTR-1 vs GSTR-3B (turnover and tax declared), GSTR-2B auto-populated ITC vs ITC claimed in GSTR-3B, e-way bill portal data vs GSTR-1 outward supply, e-invoice (IRP) data vs GSTR-1, ICEGATE import data vs GSTR-3B IGST credit on imports, income tax return (ITR) turnover vs GST turnover, TDS Form 26AS data vs GSTR-3B, and sector-level benchmarks. Taxpayers whose data shows material deviations from any of these comparisons are flagged for ASMT-10 issuance. High-risk sectors (construction, pharmaceuticals, restaurants, e-commerce, exporters) receive heightened scrutiny attention.

Manual Officer-Initiated Scrutiny

Beyond the automated system, Proper Officers may independently review the returns of taxpayers within their jurisdiction, particularly: large taxpayers with significant turnover; taxpayers with unusually high ITC claims relative to output tax; exporters claiming IGST refunds (GSTR-1 vs ICEGATE shipping bill mismatch); and taxpayers flagged by other government agencies (customs, income tax, SFIO, ED) as high-risk. Manual scrutiny results in ASMT-10 when the officer finds a discrepancy that warrants a formal explanation.

What Are the 8 Most Common ASMT-10 Discrepancy Types?

Each ASMT-10 notice specifies the exact discrepancy, the period to which it relates, and the amount involved. Understanding the 8 most frequently flagged discrepancy types allows businesses to pre-audit their own data before ASMT-10 arrives, and to prepare explanations efficiently when it does.

Discrepancy Type 1: GSTR-1 Outward Supply vs GSTR-3B Outward Supply Mismatch

The officer compares the outward supply turnover declared in GSTR-1 (invoice-level detail) with the outward supply turnover declared in GSTR-3B (consolidated self-assessment). Where GSTR-3B turnover is lower than GSTR-1 for the same period, the officer issues ASMT-10 for the tax on the shortfall.

• Common genuine explanations: Credit notes issued and not yet reflected; amended invoices in a subsequent period; advances received and declared in GSTR-3B but not yet taxed in GSTR-1; rounding differences between invoice-level GSTR-1 and consolidated GSTR-3B computation.
• Documentation: Reconciliation statement, credit note register, advance receipt ledger, computation workings.
• Red flag (act on DRC-03): If GSTR-1 shows significantly higher turnover than GSTR-3B with no credit notes or amendments and no business reason, pay the tax difference via DRC-03.

Discrepancy Type 2: GSTR-2B Auto-populated ITC vs GSTR-3B ITC Claimed

Where the ITC claimed in GSTR-3B exceeds the ITC auto-populated in GSTR-2B (derived from suppliers’ GSTR-1), the officer issues ASMT-10 for the excess ITC claim. This is the single most common ASMT-10 trigger nationally, because GSTR-2B vs GSTR-3B gaps are generated by late GSTR-1 filers, mismatched GSTINs on purchase invoices, and ITC claimed in the wrong period.

• Common genuine explanations: ITC on Bill of Entry (import IGST) which does not appear in GSTR-2B but is eligible under Rule 36; ITC from a supplier who filed GSTR-1 late (appeared in a subsequent GSTR-2B period but was claimed earlier); ITC on input services where the GSTIN was incorrectly mentioned by the supplier in their GSTR-1 (the supplier has since amended); ITC for which a debit note was issued in a subsequent period (ITC eligibility is in the debit note period).
• Documentation: Bill of Entry with proof of IGST payment (for import credit); supplier’s amended GSTR-1 (showing the corrected entry now in GSTR-2B); supplier acknowledgement of late filing; purchase register with invoice details; Section 16 eligibility confirmation (goods received, payment made within 180 days, return filed).
• Red flag (act on DRC-03): ITC claimed for suppliers who did not exist or never filed returns; ITC on ineligible items under Section 17(5) (club memberships, personal expenses, passenger vehicles).

Discrepancy Type 3: E-Way Bill Data vs GSTR-1 Outward Supply

The e-way bill portal records supply value and GSTIN for every e-way bill generated. Where the aggregate e-way bill data for outward movements from a taxpayer’s premises exceeds the outward supply declared in GSTR-1, the officer issues ASMT-10 for the suspected suppressed turnover.

• Common genuine explanations: E-way bills for stock transfers to own warehouses or job work sites (non-taxable; Form ITC-04 applicable for job work); e-way bills for goods sent on approval (Section 7, no supply until approval); e-way bills for returns to suppliers (inward supply, not outward); e-way bills for inter-state branch transfers reported in GSTR-1 as zero-rated supply; e-way bill value exceeds invoice value due to MRP or estimated value in e-way bill.
• Documentation: E-way bill register with classification (supply/non-supply/returns); ITC-04 for job work dispatches; delivery challan for branch transfers; approval records for goods sent on approval.

Discrepancy Type 4: E-Invoice (IRP) Data vs GSTR-1

From FY 2020-21 onwards (for eligible taxpayers), all B2B invoices are uploaded to the Invoice Registration Portal (IRP), generating an IRN. The GSTN aggregates IRP data and compares it with GSTR-1. Where IRP-confirmed invoices are missing from GSTR-1, ASMT-10 is issued for the tax on the un-reported invoice value.

• Common genuine explanations: E-invoices cancelled at IRP and not uploaded to GSTR-1 (cancellation within the 24-hour window); B2C supplies mistakenly registered as B2B in the IRP; test or draft IRNs generated and cancelled.
• Documentation: IRP cancellation records; B2C invoice list confirming the supplies were to unregistered persons; corrected GSTR-1 amendments.

Discrepancy Type 5: Reverse Charge Mechanism (RCM) Non-Compliance

Where a registered person has purchased services from unregistered suppliers (for which RCM applies), or services notified under Section 9(3) of the CGST Act (legal services, GTA services, director remuneration, import of services), the officer’s scrutiny identifies that RCM liability was not declared in Table 3.1(d) of GSTR-3B or was declared but not paid.

• Common genuine explanations: GTA services paid to a registered GTA (RCM not applicable if GTA is registered and paying GST at 12%); legal services from an advocate who registered mid-year (RCM applies only until registration); import of services from an associated enterprise below the Rs. 5,000 daily threshold; services genuinely covered by Section 9(3) were misidentified as forward charge.
• Documentation: GTA invoice showing GSTIN and GST at 12%; advocate’s registration certificate; import of services register; Section 9(3) applicability analysis.
• Red flag (act on DRC-03): If GTA services were paid and the GTA confirms they are unregistered or charging 5% (in which case RCM applies), the RCM liability is genuine and DRC-03 payment is appropriate.

Discrepancy Type 6: GSTR-9 Annual Return vs GSTR-3B Monthly Returns

GSTR-9 (annual return) requires taxpayers to declare turnover, ITC, and tax for the entire financial year. Where GSTR-9 figures differ from the sum of GSTR-3B figures for the year, the officer issues ASMT-10 for the difference, particularly if GSTR-9 shows higher output tax or higher ITC than the monthly GSTR-3B totals.

• Common genuine explanations: Amendments made in later periods (credit notes or debit notes from FY crossing to next year reflected in next year’s GSTR-3B but in the relevant year’s GSTR-9); ITC reversed in GSTR-3B but shown as eligible in GSTR-9 after Section 17(5) re-analysis; rounding differences; GSTR-9 includes adjustments that GSTR-3B did not capture at the time.
• Documentation: Period-wise reconciliation between GSTR-3B totals and GSTR-9 data; debit note and credit note register; ITC reversal analysis under Rule 42/43.

Discrepancy Type 7: IGST vs CGST/SGST Classification Error

Where a taxpayer has paid CGST and SGST on a supply that the officer believes was an interstate supply (and should have attracted IGST), or vice versa, ASMT-10 is issued for the wrong classification of tax. This is common for businesses with multi-state operations, e-commerce sellers, and businesses with complex place-of-supply determinations.

• Common genuine explanations: B2C local supply where the place of delivery differs from the billing address (place of supply based on billing address for B2C); services with specific place of supply rules under Sections 12 or 13 of the IGST Act (banking, insurance, transport, software); zero-rated supplies (exports) where IGST was not paid but LUT was in force.
• Documentation: Place of supply analysis for the disputed invoices; LUT acknowledgement for zero-rated supplies; delivery address vs billing address reconciliation; franchise or distributor agreement specifying location of supply.

Discrepancy Type 8: TDS Credit (Section 51) or TCS Credit (Section 52) Mismatch

Where TDS has been deducted by the taxpayer’s buyers (government entities, PSUs, specified persons under Section 51) or TCS has been collected by e-commerce operators (Section 52), the corresponding credit appears in the taxpayer’s Form GSTR-2A/2B as TDS/TCS credit. Where the taxpayer claimed this credit in GSTR-3B but the deductor’s GSTR-7 does not match, ASMT-10 is issued for the excess credit.

• Common genuine explanations: TDS deducted but GSTR-7 filed late by deductor (credit appears in a later GSTR-2B); TCS collected by e-commerce operator for a different GSTIN; TDS on exempt supplies (deductor should not have deducted, and credit is ineligible); inter-state TDS (IGST TDS claimed as CGST credit).
• Documentation: GSTR-7 filed by the deductor (request copy from buyer); TCS certificate from e-commerce operator; supply invoices confirming the GSTIN and credit eligibility.

How Do You Reply to ASMT-10 Using Form ASMT-11?

Form ASMT-11 is the statutory reply to ASMT-10, filed under Rule 99(2) of the CGST Rules. The reply must be filed within 30 days of receiving ASMT-10, or within any extended period granted by the officer in writing. There is no automatic extension: you must request an extension before the 30-day deadline expires if more time is needed, citing the complexity of the reconciliation or the volume of documentation required.

1. Download ASMT-10 and identify each specific discrepancy, amount, and period. ASMT-10 lists discrepancies in a tabular format: the data source used by the officer (GSTR-1, GSTR-2B, e-way bill, etc.), the declared figure, the system figure, and the difference. List each discrepancy separately. Determine for each discrepancy whether it is: (a) a genuine error requiring DRC-03 payment, (b) explainable by a timing difference or data matching limitation, or (c) a system error where the officer’s data is incorrect. The response strategy for each discrepancy type is different.
2. Prepare a reconciliation statement for each discrepancy. For every discrepancy flagged in ASMT-10, prepare a period-wise reconciliation that explains the difference between your declared figure and the system figure. Include the exact data source the officer used, the corresponding data from your books, and the bridging explanation. A reconciliation that presents the officer’s figure and your figure side-by-side, with each difference explained line by line, is far more persuasive than a narrative explanation alone.
3. Gather supporting documentation for each explanation. Match documents to explanations: for a GSTR-2B vs GSTR-3B mismatch caused by a late-filing supplier, attach the supplier’s amended GSTR-1 data or a screenshot of the ITC now appearing in your GSTR-2B for the subsequent period. For an e-way bill vs GSTR-1 mismatch caused by stock transfers, attach delivery challans and Form ITC-04 (for job work). For an RCM dispute, attach the supplier’s registration certificate or GTA invoice confirming the rate. Documents that are referenced in ASMT-11 but not attached are not part of the record and will not help on appeal.
4. For discrepancies you accept, file DRC-03 first, then reference it in ASMT-11. If any discrepancy in ASMT-10 represents a genuine tax shortfall you agree with, pay the differential tax (and any applicable interest under Section 50(1) at 18% per annum) via Form DRC-03 before filing ASMT-11. In ASMT-11, state the DRC-03 challan number, date, and amount paid. This demonstrates good faith and is the most effective way to prevent the accepted discrepancy from escalating to a formal demand under Section 73/74. The officer can issue ASMT-12 closing the entire scrutiny if all discrepancies are either explained satisfactorily or settled via DRC-03.
5. File ASMT-11 through the portal before the 30-day deadline. Access the ASMT-10 notice under Services > User Services > View Notices and Orders and use the Reply function linked to the ASMT-10 reference. Upload all documentation as numbered PDF exhibits referenced in the ASMT-11 text. Submit before the deadline and save the portal acknowledgement number and timestamp. If you are filing close to the deadline and the portal is slow, take a screenshot of the submission confirmation immediately.
6. Follow up if ASMT-12 is not passed within a reasonable period after ASMT-11. Once ASMT-11 is filed, the officer must review it and either pass ASMT-12 (closing the scrutiny) or initiate further proceedings. There is no statutory deadline for ASMT-12, but if the officer does not respond for several weeks and you have not received any escalation notice (Section 65 audit order or DRC-01), write to the officer requesting the status of the scrutiny and a copy of the ASMT-12 order.

Should You Pay the Discrepancy via DRC-03 or Contest It in ASMT-11?

Every ASMT-10 notice requires a strategic decision for each discrepancy listed: pay and close (via DRC-03 and ASMT-11) or explain and contest (via ASMT-11 alone). The following framework helps businesses make this decision quickly and correctly.

Pay via DRC-03 When

• The discrepancy represents a genuine tax shortfall: supplies were made and tax was not paid, or ITC was claimed without valid documentation.
• The GSTR-2B vs GSTR-3B mismatch is because ITC was claimed from a supplier who genuinely did not file GSTR-1 (ineligible ITC under Rule 36(4) as it exceeded the permissible threshold).
• The GSTR-1 vs GSTR-3B difference exists because supplies were declared in GSTR-1 but not in GSTR-3B (the tax was genuinely not paid).
• The RCM liability exists for purchases from unregistered suppliers or Section 9(3) notified services and was genuinely not paid in the relevant period.
• The e-way bill data includes supplies that were genuinely not declared in GSTR-1.

When paying via DRC-03: select “Scrutiny” or “Voluntarily” as the reason, specify the ASMT-10 reference number, and pay both the tax principal and the applicable interest at 18% per annum from the due date of the original return period to the DRC-03 payment date. This stops further interest from accruing and gives the officer the basis to pass ASMT-12 closing the scrutiny.

Contest via ASMT-11 Explanation When

• The GSTR-2B vs GSTR-3B mismatch is because the supplier filed GSTR-1 late and the ITC now appears in a subsequent GSTR-2B (ITC is eligible, just appeared in the wrong period from the system’s perspective).
• The GSTR-1 vs GSTR-3B difference is because credit notes were issued and reduced the net liability, but the credit notes appear in GSTR-1 while GSTR-3B shows the net figure after credit notes.
• The e-way bill data includes stock transfers, returns of goods, or job work dispatches (non-taxable movements generating e-way bills without creating a supply).
• The officer’s data source is incorrect: the wrong GSTIN was compared, or the officer used e-way bill data for a different registration (e.g., a branch).
• The GSTR-9 vs GSTR-3B difference is due to legitimate reconciliation adjustments (timing differences, debit notes, credit notes across periods).

What Happens After Your ASMT-11 Reply: ASMT-12 or Escalation?

After reviewing the ASMT-11 reply, the Proper Officer has two paths.

Path 1: ASMT-12 (Scrutiny Closed, No Further Action)

If the ASMT-11 explanation is found satisfactory for all discrepancies in ASMT-10, the officer passes Form ASMT-12 under Section 61(3) of the CGST Act. ASMT-12 is an order acknowledging that the explanation has been found acceptable and that no further action will be taken for the periods and discrepancies covered by the ASMT-10 notice. ASMT-12 is the favorable outcome. It does not prevent the officer from scrutinizing other periods or other discrepancies in future ASMT-10 notices: it closes only the specific ASMT-10 to which the ASMT-12 is linked. Download and preserve the ASMT-12 order as evidence that the scrutiny was resolved without demand or audit.

Path 2: Escalation

If the ASMT-11 explanation is found unsatisfactory, or if ASMT-11 is not filed at all, the officer may initiate any of the following, which represent escalating levels of scrutiny and risk.

The practical message is that ASMT-10 and ASMT-11 are at the earliest, least disruptive point of the GST compliance spectrum. A business that ignores ASMT-10 or files an inadequate ASMT-11 slides down this escalation ladder rapidly. Businesses that receive GSTR-3A return non-filing notices alongside ASMT-10 are particularly vulnerable to Section 62 best judgement assessment and should treat both notices as urgent.

How Is ASMT-10 Different from a Section 73 or 74 Demand Notice?

The distinction between ASMT-10 (scrutiny notice) and DRC-01 (demand notice under Sections 73 or 74) is frequently misunderstood by taxpayers who receive ASMT-10 for the first time. The differences are consequential for how the taxpayer should respond and what legal rights apply at each stage.

The strategic implication is clear: resolve ASMT-10 at the ASMT-11 stage. If the discrepancy is genuine, paying via DRC-03 at the ASMT-10 stage avoids the 10% to 100% penalty that attaches once DRC-01 is issued. If the discrepancy is explainable, a thorough ASMT-11 can result in ASMT-12 closure without any penalty, demand, or audit. For businesses managing ongoing GST compliance and entity registration obligations, our Pvt Ltd company registration guide covers the structural compliance framework within which ASMT-10 scrutiny operates. Businesses that received RFD-08 refund rejection notices alongside an ASMT-10 (because the officer is simultaneously scrutinizing a refund claim) should address both notices in the relevant reply periods to prevent a compounding adverse outcome. Businesses facing a REG-17 GST registration cancellation notice while also under ASMT-10 scrutiny must prioritize the REG-17 reply: registration cancellation during an ASMT-10 period can foreclose the taxpayer’s ability to operate and file returns, which in turn triggers best judgement assessment under Section 62.

Frequently Asked Questions on GST Notice ASMT-10