GST notice ASMT 14 best judgment assessment non filer defence

Receiving Form GST ASMT 14 often leads to confusion in accounts departments and business offices. Many accountants mistakenly believe that ASMT 14 is a routine non-filer notice sent to regular registered taxpayers who missed filing their monthly GSTR-3B. That assumption is legally incorrect and leads to defective replies that tax authorities reject.

The CGST Act provides two separate best judgment assessment mechanisms: Section 62 for registered non-filers of returns, and Section 63 for unregistered persons and cancelled registrations. Confusing these two sections can lead to coercive recovery under Section 79. Understanding the statutory framework ensures you file the correct defence within the fifteen-day limitation period.

The statutory difference between Section 62 and Section 63

To defend against an assessment notice, you must identify whether proceedings fall under Section 62 or Section 63 of the CGST Act:

Under Rule 100(2) of the CGST Rules, Form GST ASMT 14 is specifically issued under Section 63 of the CGST Act. The rule prescribes:

“The proper officer shall issue a notice to a taxable person in accordance with the provisions of section 63 in FORM GST ASMT-14 containing the grounds on which the assessment is proposed to be made on best judgment basis and after allowing a time of fifteen days to such person to furnish his reply, if any, pass an order in FORM GST ASMT-15.” ( CGST Rules Rule 100(2), cbic-gst.gov.in )

In contrast, when a registered person defaults on returns under Section 39 or Section 45, the department issues Form GSTR-3A under Section 46. As clarified in paragraph 3 of CBIC Circular No. 129/48/2019-GST, no separate show cause notice is issued before passing a best judgment assessment order under Section 62. If the defaulter fails to file the return within fifteen days of Form GSTR-3A, the officer issues an assessment order directly in Form GST ASMT-13.

Why taxpayers receive Form GST ASMT 14

The proper officer initiates proceedings under Section 63 and issues Form GST ASMT 14 under two distinct statutory circumstances:

1. Failure to obtain registration: A business entity whose aggregate turnover in a financial year exceeded the threshold limit under Section 22 (such as ₹40,00,000 for suppliers of goods or ₹20,00,000 for service providers in standard states), or who engaged in mandatory registration activities under Section 24 (such as inter-state taxable supplies or e-commerce operations), but failed to obtain a GSTIN.

2. Taxable supplies after cancellation: A person whose registration was cancelled by the proper officer under Section 29(2) (for non-filing of returns or non-commencement of business), but who continued to effect taxable supplies or whose past tax liabilities remained unpaid for periods prior to or following cancellation.

The department identifies these cases through third-party data matching: income tax TDS returns under Section 194C, 194J, or 194-O, bank statements obtained during audits, e-way bills generated by counterparties, and inward supplies reported by registered vendors in their outward statements.

The non-filer contrast: how Section 62 works

If you are a registered taxpayer who defaulted on monthly or quarterly returns, your statutory route is governed by Section 62, not Section 63:

1. Notice in Form GSTR-3A: Issued under Section 46 read with Rule 68, granting fifteen days to furnish the defaulting return.

2. Assessment order in Form GST ASMT-13: If returns remain unfiled after fifteen days, the officer passes a best judgment assessment order in Form GST ASMT-13 under Rule 100(1), uploaded with a summary in Form GST DRC-07.

3. Deemed withdrawal under Section 62(2): If the registered person furnishes a valid return within sixty days of the service of the ASMT-13 order, the assessment order is deemed to have been withdrawn automatically. If not filed within sixty days, an extended period of an additional sixty days is available on payment of an additional late fee of ₹100 per day under Section 62(2) proviso.

This automatic withdrawal mechanism is unique to Section 62. It provides complete protection to registered return non-filers who bring their compliance up to date. However, this statutory benefit is unavailable against an ASMT 14 notice.

Legal defences against Form GST ASMT 14 under Section 63

When you receive Form GST ASMT 14, you must submit a written reply supported by documentary evidence within fifteen days. Your defence strategy depends on your operational status:

Defence 1: turnover below registration threshold

If the department alleges you failed to obtain registration, verify your actual aggregate turnover as defined under Section 2(6) of the CGST Act. Officers frequently add gross bank credits or loan disbursements, mistaking them for taxable turnover. Prepare a bank reconciliation showing non-revenue credits, capital infusions, and exempt supplies. Demonstrate that your taxable turnover remained below the Section 22 threshold throughout the relevant financial year.

Defence 2: supplies are exempt or non-taxable

Prove that outward supplies fall under exempt notifications (such as healthcare, educational services, or unbranded agricultural produce) or non-taxable categories under Schedule III. When aggregate turnover consists entirely of exempt supplies, Section 23(1)(a) explicitly exempts the person from obtaining registration.

Defence 3: no compulsory registration liability under Section 24

If the notice alleges inter-state supply, verify whether the transactions qualify for threshold exemptions. For example, service providers making inter-state supplies enjoy threshold exemption up to ₹20,00,000 under Notification No. 10/2017-Integrated Tax. Similarly, persons supplying handicraft goods inter-state are exempt from compulsory registration under Notification No. 21/2018-Integrated Tax subject to conditions.

Defence 4: cancellation defence and revocation under Section 30

If Form GST ASMT 14 is issued because your registration was cancelled under Section 29(2) while the officer estimated ongoing business:

1. If business actually ceased, submit documentary proof of closure (lease termination, bank account closure, utility surrender) proving no supplies were made post-cancellation.

2. If cancellation occurred due to return defaults and business continues, file an application for revocation of cancellation in Form GST REG-21 under Section 30 of the CGST Act. Once registration is restored, furnish all pending returns and submit the restoration proof to the assessing officer.

Navigating ASMT 14 on the GST portal

To view and reply to an ASMT 14 notice on the GST portal:

1. Log into the GST portal with your credentials (or temporary ID if created for unregistered proceedings).
2. Navigate to Services > User Services > View Additional Notices and Orders.
3. Locate the case titled Assessment of Unregistered Persons or reference number starting with your state code.
4. Click View to inspect the notice in Form GST ASMT 14 and download departmental computation sheets.
5. Click the REPLIES tab and click Add Reply to upload your point-by-point explanation and supporting annexures.

Unlike scrutiny proceedings where taxpayers use an ASMT-10 reply format, an ASMT 14 reply is submitted directly on the case portal under Section 63 proceedings.

Preventing recovery proceedings under Section 79

Under Rule 100(2), if the taxpayer fails to furnish a satisfactory reply within fifteen days of Form GST ASMT 14, the proper officer passes a best judgment assessment order in Form GST ASMT 15. Simultaneously, a summary order is uploaded electronically in Form GST DRC-07 under Rule 142(5).

Under Rule 142(6), the DRC-07 summary order serves as the formal notice for recovery. If the demand remains unpaid and no appeal is preferred within three months, the proper officer initiates coercive recovery proceedings under Section 79 of the CGST Act. This includes attaching bank accounts, directing debtors to pay the department under garnishee powers, or seizing assets.

If an adverse ASMT 15 order is passed, the taxpayer must file an appeal before the Appellate Authority under Section 107(1) within three months in Form GST APL-01. Under Section 107(6), payment of admitted dues in full plus ten per cent of the disputed tax grants an automatic stay of recovery proceedings under Section 107(7).

For more details on recovery defence, read our guide on DRC-07 recovery proceedings.

Worked example: defending an ASMT 14 notice

Consider an actual business scenario for Sri Balaji Logistics, a proprietorship firm in Coimbatore. The firm provided road transport coordination services. The proprietor did not obtain GST registration, believing turnover was exempt. The State GST officer issued a notice in Form GST ASMT 14 proposing a best judgment assessment under Section 63 for the financial year 2024-25, estimating taxable turnover at ₹48,00,000 based on counterparty TDS deductions under Section 194C, and proposing a tax demand of ₹8,64,000 at 18% along with penalty.

The firm engaged their tax consultant and performed a line-by-line financial reconciliation:

Sri Balaji Logistics submitted their reply within twelve days of receiving Form GST ASMT 14, attaching customer contracts proving pure agent status under Rule 33, bank statements, and a Chartered Accountant turnover certificate. The proper officer accepted that actual taxable turnover was ₹12,50,000, well below the ₹20,00,000 registration threshold under Section 22(1), and dropped the proposed assessment without issuing an ASMT 15 order.

Draft reply format for Form GST ASMT 14

Adapt this structured legal format when submitting your reply against Form GST ASMT 14 on the GST portal:

Common mistakes when handling ASMT 14 notices

1. Treating ASMT 14 as a return non-filer notice: Submitting a letter requesting automatic withdrawal under Section 62(2) is an immediate failure. Section 62(2) applies only to ASMT-13 orders passed against registered return non-filers.

2. Failing to reply within fifteen days: Rule 100(2) gives fifteen days to reply. If you ignore the notice, the officer passes an ex parte order in Form GST ASMT-15, creating an immediate enforceable liability in Form GST DRC-07.

3. Not submitting bank reconciliation: Tax officers base Section 63 assessments on gross bank deposits. Providing total sales figures without explaining non-taxable bank credits leaves the officer free to confirm the original estimate.

4. Overlooking DRC-01C mismatch notices: If your suppliers face assessment or non-filing notices, their delayed filings will disrupt your input tax credit, triggering an automated intimation under our guide on DRC-01C ITC mismatch notices.

Frequently asked questions

Last checked: 21 October 2026. Sources: CGST Rules Rule 100, CGST Act Section 63, CBIC Circular 129/48/2019-GST, CBIC Assessment Rules.