Tax Consultant
1820 Points
Posted on 16 June 2026
DRC-01C is an ITC mismatch notice. It blocks GSTR-1 filing until you respond. Here is what to do step by step:
WHY YOU GOT IT: The GST portal detected that the ITC you claimed in GSTR-3B exceeds ITC available in GSTR-2B by more than the permitted limit (either 20% of GSTR-2B credit or Rs. 25 lakh, whichever is lower applies for the specific rule). This triggers an automatic notice.
HOW TO RESPOND (two options):
1. If the difference is genuine (supplier has not filed GSTR-1 yet):
Log in to GST portal. Go to Returns, then Compliance. Open DRC-01C Part B. Select the option that says the ITC difference is due to pending supplier GSTR-1. File Part B. The block on GSTR-1 is lifted and you can file. Note: you will need to reverse the excess ITC in the next GSTR-3B if it is not subsequently validated by the supplier.
2. If you claimed ITC by mistake:
Log in to the portal. Open DRC-01C Part B. Select the option to reverse the excess ITC. File Part B (this adds the reversal to your GSTR-3B). This unblocks GSTR-1.
IMPORTANT: Do not ignore DRC-01C. A non-response within 7 days can result in a demand notice under Section 73 on top of the GSTR-1 block.
For the full GSTR-2B reconciliation process to avoid future DRC-01C notices: [GSTR-2A vs GSTR-2B reconciliation guide](https://taxgarden.in/blog/gstr-2a-vs-gstr-2b-difference-reconciliation-guide)