Received Form GST DRC-01C – the automatic intimation under Rule 88D that the input tax credit claimed in your GSTR-3B exceeds what is available in GSTR-2B? You have 7 days to respond in Part B, and your next GSTR-1 stays blocked until you do. This free CA-built tool reconciles the difference reason-wise, generates ready-to-paste Part B explanations (each within the portal’s 500-character limit), and prepares a detailed reconciliation annexure for your records – because the online Part B form accepts no attachments.
1Intimation details (from Part A)
ITC comparison as per Part A (Rs)
| Head | ITC available per GSTR-2B | ITC claimed per GSTR-3B | Difference |
|---|---|---|---|
| IGST | 0 | ||
| CGST | 0 | ||
| SGST | 0 | ||
| Cess | 0 | ||
| Total | 0 | 0 | 0 |
2Explain the difference – select the applicable reasons
These are the nine reasons exactly as notified in Form DRC-01C Part B. Enter the amount attributable to each reason and your specific facts – invoice or BoE numbers, supplier names, periods. Specific beats generic.
3Payment for any genuinely excess ITC (optional)
What is DRC-01C and when is it issued?
Form GST DRC-01C is an automatic, system-generated intimation under Rule 88D of the CGST Rules (introduced from 4 August 2023). After you file GSTR-3B, the system compares the ITC claimed with the ITC available in GSTR-2B for the period. Where the excess crosses the system threshold – as per the GST Council’s recommendation, currently understood to be a difference above 20 percent and Rs 25 lakh, though the parameter is configurable and not separately notified – Part A of DRC-01C lands on your dashboard, email and SMS.
You must respond within 7 days in Part B, by paying the excess (via DRC-03), explaining it against the notified reasons, or both. Until you respond, Rule 59(6)(e) blocks your next GSTR-1/IFF. If no response is furnished or the explanation is not found acceptable, the amount can be taken up for demand under Section 73/74 (Section 74A for FY 2024-25 onwards) – the intimation itself is not a demand.
The nine notified reasons – and what they cover
| # | Reason (as in the form) | Typical use / legal basis |
|---|---|---|
| 1 | ITC not availed earlier due to non-receipt of supplies (incl. instalments) | Goods received after the invoice month – Section 16(2)(b) |
| 2 | ITC not availed earlier inadvertently / by omission | Earlier-period 2B credit claimed now, within the Section 16(4) window (30 November of the next FY) |
| 3 | Import of goods ITC not reflected in GSTR-2B | Bill of Entry credit under Rule 36(1)(d) – ICEGATE data lag, ex-bond clearances |
| 4 | SEZ inward supplies not reflected in GSTR-2B | BoE-based credit on SEZ procurements |
| 5 | Reclaim of excess reversal of earlier periods | Rule 42/43 annual true-up, provisional reversals reclaimed |
| 6 | Rule 37 recredit – supplier since paid (180-day rule) | Third proviso to Section 16(2) read with Rule 37(4) |
| 7 | Rule 37A recredit – supplier has since filed GSTR-3B | Rule 37A proviso re-availment |
| 8 | GSTR-3B filed with incorrect details – will be amended next period | Clerical errors adjusted per Circular 26/26/2017-GST |
| 9 | Any other reasons (specify) | RCM self-invoice ITC (never appears in 2B), ISD credit timing, credit-note timing, Section 16(5)/16(6) claims |
Frequently asked questions
Is DRC-01C a demand notice?
No. It is an automated intimation – no officer has adjudicated anything. A demand can follow under Section 73/74 only if you fail to respond or your explanation is rejected, and that process has its own notice and hearing rights.
What happens if I miss the 7-day window?
Your next GSTR-1/IFF remains blocked until you file Part B, and the matter can be escalated to a demand. File Part B even if late – the block lifts immediately on filing.
Do I have to pay interest if I pay part of the difference?
Interest under Section 50(3) read with Rule 88B applies at 18 percent only where the wrongly availed credit was utilised – that is, only if your electronic credit ledger balance fell below the disputed amount, and only for the period it stayed below. If the credit merely sat unutilised in the ledger, no interest is payable.
Can I attach my reconciliation working to Part B?
No – Part B is a structured online form with a 500-character details box per reason and no upload facility. Keep the detailed annexure generated here in your records and produce it if the officer follows up.
My difference is because of RCM ITC. Which reason do I pick?
Reverse-charge credit on self-invoices (unregistered suppliers, import of services) never appears in GSTR-2B, but the form has no dedicated checkbox for it – select reason 9 (Any other reasons) and state the RCM facts specifically.