The electronic and magnetic states of Mn2.97Co0.03GaC are studied by soft X-ray photoelectron spectroscopy (SXPES) and X-ray magnetic circular dichroism (XMCD) in the Mn 2p --> 3d excitation region. On the basis of the XMCD results, the contribution of the orbital magnetic moment to the Mn 3d magnetic moment is evaluated by the XMCD sum rules. The spectra obtained by SXPES show a clear change in electronic states near the Fermi level across the first-order ferromagnetic to antiferromagnetic phase transition. The experimental results are consistent with the theoretically obtained electronic structures of the two phases.