Tax Guide

GST — DRC-01C notification (Rule 88D): ITC mismatch auto-notice

Key mapping

CBIC Notification No. 38/2023 inserted Rule 88D — if ITC claimed in GSTR-3B exceeds ITC in GSTR-2B, the portal auto-generates DRC-01C. GSTR-1 of the next period is blocked until DRC-01C Part B is filed.

Explanation

CBIC Notification No. 38/2023–Central Tax (dated 4 August 2023) introduced Rule 88D to the CGST Rules 2017. Rule 88D: where the ITC availed by a registered person in GSTR-3B exceeds the ITC available in GSTR-2B by such percentage as may be prescribed, the portal auto-generates DRC-01C. Reply (DRC-01C Part B) must be filed within 7 days explaining the excess ITC or paying the difference via DRC-03. Failure to reply blocks next period's GSTR-1. This rule was a response to fake ITC claims. Verify on cbic-gst.gov.in.

Related terms and sections

DRC-01C Rule 88D CBIC Notification 38/2023 ITC mismatch GSTR-3B GSTR-2B 7 days GSTR-1 blocked

Use this in practice

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Related sections

IT Act 2025 Section Mapper →All IT Act changes →

All section references are sourced from the Income Tax Act 2025 (official gazette, incometaxindia.gov.in) and cross-referenced against CBDT's comparative statement. Always verify on the official portal before filing. This page is for reference only and does not constitute legal or tax advice.

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