Grade C is terrible shame (8)
I believe the answer is:
disgrace
'shame' is the definition.
('disgrace' can be a synonym of 'shame')
'grade c is terrible' is the wordplay.
'terrible' indicates anagramming the letters.
'grade'+'c'+'is'='gradecis'
'gradecis' anagrammed gives 'DISGRACE'.
(Other definitions for disgrace that I've seen before include "Bring shame upon" , "Loss of reputation or respect" , "State of dishonour" , "scandal" , "scandalous" .)