GST · ITC · Reconciliation · GSTR-2B · Rule 36(4)
Your GSTR-3B claim and GSTR-2B do not match. Here is what that means — and the 30-day windows around it.
ITC mismatches are the most common reason GST notices arrive. The statute gives you specific windows to fix them — and specific consequences when you do not.
The four issues
Where this area actually goes wrong.
Each of the four pillars below is statute-cited — the section, the form, and the consequence. No vague claims.
GSTR-2B vs GSTR-2A — what each statement is
GSTR-2A is the dynamic, transaction-level statement of input tax credit reflected from your suppliers' GSTR-1/5/6/9 returns — it updates continuously as suppliers file or amend. GSTR-2B is the static monthly ITC statement introduced from August 2020 — the portal freezes your ITC position for each month in a single PDF you can download. Both pull from the same underlying supplier data; 2B is what the department compares against your GSTR-3B claim. A mismatch between the two is the single biggest audit trigger under GST.
2B static since Aug 2020 · 2A dynamic · both portal auto-generated
ITC eligibility — s.16(2), s.17(5), s.16(4)
Section 16(2) of the CGST Act makes ITC available only when every condition is met: you possess the tax invoice (a), the goods or services are received (b), tax has actually been paid to the government by the supplier (c), and you have paid the supplier within 180 days (d) — otherwise the credit is reversed with interest. Section 17(5) blocks credit outright for listed items — motor vehicles (except specified cases), food and beverages, personal consumption, and works contract services on immovable property except as specified. Section 16(4) is the time bar: credit must be claimed in GSTR-3B by the due date of the September return following the financial year, or the annual return date, whichever is earlier.
s.16(2)(a)–(d) · s.17(5) blocked credit · s.16(4) September time bar
The matching rule — Rule 36(4)
From 1 January 2022, Rule 36(4) of the CGST Rules caps the ITC claimed in GSTR-3B at the amount reflected in your GSTR-2B — the earlier tolerance of 20% (later 10%) of unmatched credit was removed. Claim more than 2B shows and the system flags the difference, which surfaces as an ASMT-10 intimation of discrepancy under Rule 99 and can escalate to a DRC-01C/DRC-01 demand. Your purchase register must therefore reconcile to 2B before you file 3B — not after.
Rule 36(4) 100% matching · no tolerance since Jan 2022 · ASMT-10 → DRC-01
Four-way reconciliation — the defence document
A proper reconciliation runs four comparisons: purchase register → GSTR-2B → GSTR-3B claim → GSTR-2A. It surfaces missing or wrong supplier invoices, purchases from unregistered vendors (no ITC), reverse-charge transactions under s.9(3)/s.9(4), ISD distributions under s.20, credit notes, and blocked credit under s.17(5). The output — a dated mismatch register with a reason against every difference — is the document that answers an ASMT-10, DRC-01A or departmental scrutiny, and it is the document most businesses do not have.
books vs 2B vs 3B vs 2A · RCM & ISD · mismatch register as defence
The honest angle
Why ITC mismatches become demands
The mismatch itself is usually fixable. What turns it into a demand is believing the portal is wrong without a document trail — or missing the statutory windows to correct it.
No invoice, no credit
Purchase from an unregistered vendor means zero ITC — you cannot manufacture credit. Since October 2021, s.9(4) reverse charge on all unregistered purchases is narrowed to specified goods; the practical rule is simpler: get the invoice and the supplier's GSTR-1 filed.
The 180-day payment rule bites when you are cash-strapped
s.16(2)(d) reverses credit with interest if you do not pay the supplier within 180 days — and businesses deferring supplier payments are exactly the ones carrying the credit.
September is a hard deadline
s.16(4) bars credit not claimed by the due date of the September return following the year. A credit found in October is a credit lost — no discretion, no appeal on merits.
2B is the ceiling
Rule 36(4) gives the department the arithmetic. Claiming against a purchase register the portal does not yet reflect is an invitation to ASMT-10 — reply within 30 days or it hardens into a demand.
Our engagement
Five tracks for a clean ITC position.
GSTR-2B vs books reconciliation
Four-way match (purchase register, 2B, 3B claim, 2A) with a dated mismatch register and a reason against every difference.
Monthly
Supplier follow-up and corrections
Identify suppliers missing from 2B, drive their GSTR-1 filing or amendment within the statutory correction window, and re-claim credit in the month it appears.
Monthly
RCM and ISD review
Reverse-charge entries under s.9(3)/s.9(4) and Input Service Distributor allocation under s.20 — the two credit lines most often missed or double-counted.
Monthly / quarterly
Blocked credit and 180-day tracking
s.17(5) blocked items review and a 180-day payment tracker so s.16(2)(d) reversals never surprise you.
Monthly
ASMT-10 / DRC-01C response
Reply within the 30-day window with the reconciliation register as support — before the intimation hardens into a demand.
As needed
FAQs
Five questions every reconciliation raises.
GSTR-2B shows less ITC than my purchase register. Can I still claim the full amount in GSTR-3B?
No. Under Rule 36(4) of the CGST Rules, from 1 January 2022 the ITC claimed in GSTR-3B cannot exceed the amount reflected in GSTR-2B — the earlier 20%/10% tolerance was removed. Claiming more creates a discrepancy that the department sees as an ASMT-10 intimation under Rule 99. The correct sequence: identify which suppliers are missing from 2B, get them to file or amend their GSTR-1 within the correction window, and claim the credit in the month it appears in your 2B — within the s.16(4) September time bar.
I did not pay my supplier within 180 days. What happens to my ITC?
Under s.16(2)(d) of the CGST Act, if you do not pay the supplier within 180 days of the invoice, the credit you took must be reversed — added back to your output tax liability — along with interest under s.50 for the period the credit was held. The good news: the credit is not lost permanently. When you subsequently pay the supplier, you can re-claim the ITC. The practical fix is a payment tracker so reversals with interest never come as a surprise at year-end.
Can I claim ITC for last financial year's purchases in June this year?
Only if you claim it by the due date of the September return following that financial year — s.16(4) of the CGST Act. For FY 2025-26, that means claiming in a GSTR-3B filed by the September 2026 due date (20 October 2026 for monthly filers), or by the annual return date, whichever is earlier. Credit discovered after that is barred — the department has no discretion to allow it. A July/August reconciliation before the September return is the last reliable window.
My supplier's GSTIN is cancelled, but he issued an invoice with his old GSTIN. Can I take the credit?
No — and claiming it is where the exposure starts. ITC requires under s.16(2)(c) that tax has actually been paid to the government by the supplier. If the registration was cancelled at the invoice date, the tax was not paid, the invoice is not valid for credit, and you are exposed to reversal with interest under s.50 — and in persistent cases to penalty. Recover the tax from the supplier, get a valid invoice from a registered vendor, and document the correction. Rule 21A covers cancellation consequences for the supplier's customers.
What is the difference between ASMT-10 and DRC-01A?
ASMT-10 is an intimation of discrepancy issued under Rule 99 when scrutiny of your returns finds mismatches — you reply in ASMT-11 within 30 days, explaining or rectifying each discrepancy. DRC-01A is a pre-show-cause consultation notice under Rule 142(1A): before issuing a formal DRC-01 demand, the officer gives you a chance to either pay the amount with interest (via DRC-03) or explain in DRC-01B. If the matter is not resolved at the DRC-01A stage, it escalates to a DRC-01 show cause notice, after which s.73/s.74 windows and penalty exposure apply. Both reward a prepared, dated reconciliation register.
Get your ITC position verified
Book an ITC reconciliation — mismatch register in 5 working days.
Send us your purchase register, GSTR-2B/2A and last GSTR-3B. We return a dated mismatch register with reasons, the suppliers to chase, and the corrections to file — before the September window closes.
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