What is DRC-01C Notice?
DRC-01C is an automated GST notice issued under Rule 88D of the CGST Rules, 2017. It is sent when the GSTN system finds that the Input Tax Credit (ITC) you claimed in GSTR-3B is more than the ITC available in your GSTR-2B for the same tax period.
In simple terms: your vendor has not yet filed their GSTR-1, or you claimed more ITC than your purchase invoices support as per GSTR-2B auto-population.
📋 Key Facts About DRC-01C
| Parameter | Details |
|---|---|
| Legal Basis | Rule 88D of CGST Rules, 2017 |
| Issued By | GSTN system automatically |
| Reason | ITC in GSTR-3B > ITC in GSTR-2B |
| Reply Deadline | 7 days from notice date |
| Reply Portal | GST Portal → Services → Returns → Response to DRC-01C |
| Consequence of No Reply | GSTR-1 filing blocked for next period |
Why Did You Get a DRC-01C?
Common reasons for receiving a DRC-01C notice:
- Vendor non-filing: Your supplier has not filed their GSTR-1, so ITC doesn't appear in your GSTR-2B even though you have the invoice
- Timing difference: Vendor filed GSTR-1 for a later period, so GSTR-2B for current period shows less ITC
- ITC claimed on RCM basis: Reverse Charge Mechanism ITC not reflected in GSTR-2B but claimed in 3B
- Import ITC: IGST paid on imports not yet reflected in GSTR-2B
- Clerical error: ITC entered in wrong head (IGST vs CGST/SGST) in GSTR-3B
- Transitional credit: Old credit claimed that system cannot match
How to Reply DRC-01C — Step by Step
Download GSTR-2B and compare with GSTR-3B ITC
From the GST portal, download your GSTR-2B for the relevant period. Compare it line by line with the ITC you claimed in GSTR-3B Table 4. Find the exact amount and nature of the difference.
Identify which invoices are missing from GSTR-2B
Check your purchase register against GSTR-2B. Identify invoices where vendors have not filed GSTR-1 or where there is a period mismatch. Collect vendor GSTIN, invoice numbers, and amounts.
Choose your response
Option A — Explain the reason: Vendor has not filed, timing difference, RCM/import ITC. No payment needed but you must provide clear justification.
Option B — Reverse the excess ITC: If you agree the ITC was wrongly claimed, reverse in next GSTR-3B or pay via DRC-03.
Draft your reply letter citing Rule 88D
Your reply must cite Rule 88D of CGST Rules 2017 and Section 16 of the CGST Act 2017. Attach a reconciliation statement showing the invoice-wise difference and the reason for each discrepancy.
Submit on GST portal within 7 days
Go to Services → Returns → Response to DRC-01C on gstin.gov.in. Upload your reply and supporting documents. Save the acknowledgment number.
Generate Your DRC-01C Reply in 30 Seconds
AI-drafted reply with Rule 88D and Section 16 citations — legally accurate, ready to submit on the portal.
Generate My Free Reply →Key Legal Provisions for DRC-01C Reply
- Rule 88D, CGST Rules 2017 — Governing provision for DRC-01C ITC mismatch notice
- Section 16, CGST Act 2017 — Eligibility and conditions for ITC
- Section 38, CGST Act 2017 — Communication of details of inward supplies (GSTR-2B)
- Section 16(2)(aa) — ITC allowed only if appearing in GSTR-2B (effective from Jan 2022)
- Proviso to Section 16(2) — ITC allowed even if not in GSTR-2B if vendor subsequently files