Input Tax Credit

Got an ITC mismatch notice? How to respond to DRC-01C and ASMT-10

2 min read Updated 03 Oct 2026 1 views

AI summary

Why the portal flags ITC differences, how to find the real gap and how to reply before it turns into a demand.

6 sections 6 steps

Why you got it

DRC-01C (Rule 88D): the ITC you claimed in GSTR-3B for a month is higher than the ITC in your GSTR-2B by more than the limit set on the portal.
ASMT-10 or DRC-01A: during scrutiny of a whole year, the officer found that ITC in GSTR-3B (or GSTR-9) is higher than GSTR-2B.
Other triggers: the supplier didn't file GSTR-3B, the supplier's registration was cancelled, or you didn't pay the supplier within 180 days.

Is it a real excess?

Cause	Real excess?	What proves it
Supplier filed late, so the invoice appeared in a later month's GSTR-2B	No, timing only	GSTR-2B of the later month
ITC on reverse charge you paid in cash	No, RCM credit is not in GSTR-2B	RCM liability in GSTR-3B and cash ledger
Re-claim of ITC reversed earlier	No	Electronic Credit Reversal and Re-claimed Statement
IGST on imports where the bill of entry was late to reflect	Usually no	Bill of entry and ICEGATE data
Invoice never uploaded by the supplier	Yes	Reverse it
Same invoice claimed twice	Yes	Reverse it
Supplier used the wrong GSTIN for you	Yes, until the supplier amends	Ask the supplier to amend
Supplier's credit note not reduced from ITC	Yes	Reverse it

Step-by-step response

Reconcile. Download GSTR-2B for the month and the months around it. Match against your purchase register invoice by invoice.
Split the difference into timing or explainable items and real excess.
Real excess: pay or reverse it in DRC-03. If the wrong ITC was used to pay tax, interest at 18% applies.
Explainable items: reply in Part B of DRC-01C (or ASMT-11 for ASMT-10) with a month-wise reconciliation and documents.
Reply on time. DRC-01C needs a reply within 7 days. If you don't reply, the portal blocks your next GSTR-1 or IFF (Rule 59(6)).
Keep your working papers. You will need them for GSTR-9, the audit and any later notice.

Don't lose genuine ITC

ITC for an invoice must be claimed by 30 November after the end of the financial year or the date you file the annual return, whichever is earlier. If the supplier uploads very late, follow up before this date.

Avoid it next month

Accept, reject or keep pending each invoice in IMS before GSTR-2B is generated.
Reconcile with GSTR-2B before you file GSTR-3B, not after.
Claim ITC only for invoices that appear in GSTR-2B.
Hold payment to suppliers until their invoice shows in your GSTR-2B.

Sources

Central Goods and Services Tax Rules, 2017

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