The GST Intimation That Is Not a Notice

It does not arrive by post. It appears on the portal, it is generated by a system rather than an officer, and it gives you seven days.

That combination is why DRC-01B and DRC-01C get treated as administrative noise and filed with the rest of the portal traffic. They are not noise. One of them leads, if ignored, to recovery without any adjudication at all.

Two rules, two mismatches

In both, Part A is the system's computation of the difference, broken down by head. Part B is yours: either confirm payment or reversal made through FORM GST DRC-03 with interest, or explain.

The threshold that triggers an intimation is not published. The 48th GST Council recommended a difference of more than 20 per cent and more than ₹25 lakh for Rule 88C, but the parameters the system actually applies are not disclosed to taxpayers, and it would be a mistake to plan around a number nobody has notified.

The part that is not like a notice

A show-cause notice under section 73 or 74 begins a process. You reply, you are heard, an order follows, and the order is appealable. There is a structure, and time inside it.

Rule 88C does not work that way, and the reason sits in section 75(12).

That sub-section allows self-assessed tax that remains unpaid to be recovered under section 79 without the section 73 or 74 route. The Explanation to it — inserted by the Finance Act 2021 — provides that self-assessed tax includes the tax payable in respect of details of outward supplies furnished under section 37 but not included in the return furnished under section 39.

Read those together. Liability you declared in GSTR-1 and did not discharge in GSTR-3B is, by statutory definition, self-assessed tax. It needs no determination, because you have already determined it. The department does not have to prove anything; you said it yourself, in your own return.

So the seven days are not the first step of a hearing. They are the opportunity to pay or to show the difference is not what it looks like, before a recovery mechanism that has no hearing attached to it.

DRC-01C is different on this point, and the difference is worth holding on to. Excess input tax credit is not self-assessed tax within section 75(12). To recover it the department still has to raise a demand under section 73 or 74, with everything that follows. The bite of Rule 88D is therefore the blocking, not immediate recovery.

The blocking, which applies to both

Rule 59(6) was amended for each. Fail to furnish a reply in Part B within seven days and you cannot file the next GSTR-1 or IFF.

That is what converts a quiet intimation into an operational emergency. Your customers cannot see your invoices in their GSTR-2B, so their credit stalls, so your receivables stall. A seven-day window missed in one month becomes a commercial problem in the next, and it is usually that — not the tax — that brings the file to a professional.

What a Part B reply can properly say

A difference is not the same as a short payment. The common explanations, each of which has to be demonstrable from the records rather than asserted:

• Timing. The invoice is in GSTR-1 for this period and the tax was discharged in the GSTR-3B of an earlier or later one. Identify the period and the challan.
• Credit notes and amendments. A reduction given effect in one return and not the other, or an amendment filed in a later GSTR-1.
• Imports and ICEGATE. For credit: IGST paid on import appearing in GSTR-2B late, or not flowing through because of a data mismatch at ICEGATE.
• Reverse charge. Liability discharged under reverse charge, where the credit and the output tax sit in different places in the return.
• Credit availed and reversed. Where ITC was taken and reversed under rule 42 or 43 in the same or a later period.
• Genuine excess. Where there is no explanation, saying so and paying through DRC-03 with interest under section 50 is the right answer. A wrong explanation in Part B is worse than none.

Before you reply

• Reconcile at invoice level, not at summary level. A total that matches by coincidence will not survive the next question.
• Fix the period, not just the amount. Most of these are timing, and a timing explanation is only as good as the two return periods it names.
• Use DRC-03 for anything genuinely short, with interest, and reference it in Part B.
• Reply inside the seven days even when the reconciliation is incomplete. A Part B explaining what has been identified and what is still being traced preserves the position. Silence does not.
• Then look upstream. An intimation is a symptom. Two returns prepared from different data, or a GSTR-1 filed by one person and a GSTR-3B by another, will produce it again next month.

This note is general information on the rules as they stand, not advice on your matter. Thresholds applied by the portal are not published and the position on any intimation turns on its own facts.