Difference in Input Tax Credit (ITC) available in GSTR-2B & ITC claimed in the GSTR-3B

Dear Taxpayers,

1. It is informed that GSTN has developed a functionality to generate automated intimation in Form GST DRC-01C which enables the taxpayer to explain the difference in Input tax credit available in GSTR-2B statement & ITC claimed in GSTR-3B return online as directed by the GST Council. This feature is now live on the GST portal.

2. This functionality compares the ITC declared in GSTR-3B/3BQ with the ITC available in GSTR-2B/2BQ for each return period. If the claimed ITC in GSTR 3B exceeds the available ITC in GSTR-2B by a predefined limit or the percentage difference exceeds the configurable threshold, taxpayer will receive an intimation in the form of DRC-01C.

3. Upon receiving an intimation, the taxpayer must file a response using Form DRC-01C Part B. The taxpayer has the option to either provide details of the payment made to settle the difference using Form DRC-03, or provide an explanation for the difference, or even choose a combination of both options.

4. In case, no response is filed by the impacted taxpayers in Form DRC-01C Part B, such taxpayers will not be able to file their subsequent period GSTR-1/IFF.

Thanking you,
Team GSTN

Input Tax Credit mismatch triggers DRC-01C intimation requiring payment, explanation, or both to restore filing privileges. An automated mechanism issues Form DRC-01C when ITC claimed in GSTR-3B/3BQ exceeds ITC available in GSTR-2B/2BQ beyond configured limits; affected taxpayers must respond in DRC-01C Part B by paying the shortfall via DRC-03, furnishing an explanation, or both, and failure to respond bars filing subsequent GSTR-1/IFF.