GSTR ThreeB Blocked in FY 2026-27? Causes and How to Fix It

If you have been filing GSTR ThreeB by manually entering ITC figures from your purchase register, that approach no longer works. Starting April 2026, the GST portal enforces a hard block: your GSTR ThreeB submission will be rejected if the ITC you claim exceeds what appears in your GSTR TwoB.

This is not a warning or a notice. It is a technical block that prevents filing.

Here is what changed, why it matters, and how to fix it before your next filing deadline.

What Is the Zero Mismatch Policy

The 56th GST Council recommended stricter ITC validation to reduce revenue leakage from fraudulent or inflated input tax credit claims. The result is the Zero Mismatch Policy: the GST portal now performs a real-time comparison between your GSTR ThreeB ITC figures and your GSTR TwoB auto-drafted statement before allowing submission.

Previously, businesses could claim ITC in GSTR ThreeB that exceeded GSTR TwoB amounts. The system would flag the difference through a DRC-01C notice after filing, but filing itself was not blocked. Under the new policy, the portal stops you at the submission stage.

This means you cannot file GSTR ThreeB until the numbers match.

How the Block Works in Practice

When you attempt to submit GSTR ThreeB, the portal compares:

• Table 4A of GSTR ThreeB (ITC claimed by you) against
• GSTR TwoB auto-drafted ITC statement (ITC available based on supplier filings)

If the ITC in GSTR ThreeB exceeds the GSTR TwoB amount beyond the permitted threshold, the system rejects your submission. You will see an error indicating that ITC claimed is higher than eligible ITC.

The block applies to each head separately: IGST, CGST, SGST, and cess. A mismatch in any one head can trigger the block.

How to Compare GSTR TwoB vs GSTR ThreeB Line by Line

Step 1: Download GSTR TwoB

Log in to the GST portal after the 14th of the month. Navigate to Returns, then GSTR TwoB. Download the statement for the relevant period in Excel or JSON format.

Step 2: Map to GSTR ThreeB Table 4

GSTR TwoB is organized into sections:

Step 3: Check Each Row

For each entry in GSTR TwoB Table 3, verify:

• Supplier GSTIN matches your purchase records
• Invoice number and date match
• Taxable value and tax amounts (IGST, CGST, SGST) match
• The invoice has not been marked as "rejected" in IMS

Step 4: Identify Differences

Three common scenarios:

1. Invoices in your books but not in GSTR TwoB: Your supplier has not filed GSTR One for that period. You cannot claim ITC on these invoices until they appear in GSTR TwoB.

2. Amount differences: The supplier reported a different taxable value or tax amount. Verify the original invoice and coordinate with the supplier to amend their GSTR One.

3. ITC claimed on rejected IMS invoices: If you rejected an invoice in the Invoice Management System, it will not appear as available ITC in GSTR TwoB even if it is in your books.

Common Reasons for Mismatches

Supplier Non-Filing

The most frequent cause. If your supplier has not filed their GSTR One for the period, their invoices will not appear in your GSTR TwoB. You have legitimate invoices and have paid GST, but the system does not recognize the credit.

What to do: Follow up with the supplier immediately. Send a formal communication requesting GSTR One filing. Track supplier filing compliance monthly.

ITC Reversal Errors

If you reversed ITC in a prior period (under Rule 37 for non-payment within 180 days, or Rule 42/43 for exempt supplies), and then reclaimed it after meeting conditions, the timing of reversal and reclaim in GSTR ThreeB must align with GSTR TwoB.

What to do: Maintain a reversal and reclaim tracker. Ensure reclaims appear only after the underlying condition is satisfied and reflected in GSTR TwoB.

Timing Differences

Invoices dated in one month but reported by the supplier in the following month create timing gaps. Your books show ITC for March, but GSTR TwoB reflects it in April.

What to do: Claim ITC in the period it appears in GSTR TwoB, not the period of the invoice date in your books.

Credit Notes Not Accounted

If a supplier issues a credit note reducing the original invoice value, GSTR TwoB will reflect reduced ITC. If your books still show the original full credit, there will be a mismatch.

What to do: Process all supplier credit notes in your books before preparing GSTR ThreeB.

IMS Action Mismatches

With IMS now mandatory, invoices you rejected or kept pending in IMS will not flow into GSTR TwoB as available credit. If your books still carry these as claimable ITC, the totals will not match.

What to do: Align your IMS actions (accept/reject/pending) with your purchase register before the GSTR TwoB generation date.

Steps to Resolve Before the Filing Deadline

1. Download GSTR TwoB on the 14th of each month (or as soon as it is generated).

2. Run a line-by-line comparison with your purchase register. Use accounting software that supports GSTR TwoB import, or do it manually in a spreadsheet.

3. Identify all differences and categorize them: supplier non-filing, amount mismatch, timing difference, or IMS action issue.

4. Contact suppliers with pending GSTR One filings. Give them at least 5 days before the filing deadline.

5. Adjust your GSTR ThreeB ITC figures to match GSTR TwoB. Only claim what GSTR TwoB shows as available.

6. Track unmatched invoices separately. You can claim the ITC in a future period once it appears in GSTR TwoB (subject to the time limit under Section 16 4)).

7. File GSTR ThreeB with reconciled figures. The portal will now accept your return.

What If You Cannot Resolve in Time

If the mismatch cannot be resolved before your GSTR ThreeB deadline (typically the 20th of the following month):

• File with GSTR TwoB amounts only. Do not inflate ITC.
• Carry forward the unmatched ITC to the next period once it appears in GSTR TwoB.
• If the supplier refuses to file GSTR One, consider the commercial and legal options available, including withholding payment until compliance is confirmed.

Filing late to wait for supplier compliance is worse than filing on time with lower ITC, because late filing attracts interest and late fees. If your ITC is being withheld under the parallel hard-block rule rather than the mismatch check, our GSTR ThreeB ITC hard-block action plan walks through that separate resolution path.

Let Tax Garden Handle Your GST Reconciliation

Monthly GSTR TwoB reconciliation requires disciplined processes and supplier coordination. Tax Garden's Compliance Standard plan includes automated GSTR TwoB matching, supplier follow-up, and accurate GSTR ThreeB preparation every month.