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39 was the lowest I found as well

234-243=9

Or cant we repeat digit for both M and N

Sorry, you can't repeat digits.

Well Yes it is 39

And there is a mathematical way to do it.

So, a-a'=1 when a=4 and b=3
b-b'=-6 when b=2 and b'=6
c-c'=-1 when c=6 and c'=7

Thus, Smallest M-N=1*100+(-6)*10+(-1)=39