A fresh controversy has erupted in the GST ecosystem after a public criticism by Chartered Accountant over a recent system update announced by GST Tech, the official handle of **Infosys-led GSTN.

GST Tech Announcement Triggers Backlash

Earlier in the day, GST Tech (@Infosys_GSTN) informed taxpayers that:

“The functionality to utilise CGST or SGST ITC in any order for payment of IGST liability, after fully utilisation of IGST Credit, will be available from February-2026 period.”

The announcement indicated that from the February 2026 tax period, taxpayers would be able to use CGST or SGST input tax credit (ITC) in any order to discharge IGST liability, provided IGST credit is first fully exhausted.

While many professionals viewed the update as a long-pending system correction, the communication sparked sharp criticism from sections of the tax fraternity.

“Blunder of the Year”: CA Questions Legality

Reacting strongly on X (formerly Twitter), CA Ruchita Vaghani termed the move a “Blunder of the Year” and questioned the authority behind the announcement.

Tagging @Infosys_GSTN and the Central Board of Indirect Taxes and Customs (CBIC), she wrote:

“Announcing random thing on their Social handle and on their portal without suitable amendment in law.
With whose permission @Infosys_GSTN posting such Things???
is @Infosys_GSTN making law ?????? Why they are misguiding whole…”

Her remarks suggest concern that the system-level change may not be backed by an explicit statutory amendment, raising questions about whether a technology service provider can publicly communicate functional changes that appear to alter credit utilisation mechanics.

Legal Position on ITC Utilisation

Under Section 49 of the CGST Act and related amendments introduced in recent years, IGST credit must be utilised first. After exhausting IGST credit, CGST and SGST credits can be used for IGST liability.

However, disputes and confusion have persisted over the exact sequence and whether the portal functionality strictly mirrors statutory intent. Professionals argue that any deviation between law and portal functionality often leads to interest exposure, reconciliation mismatches, and litigation.

The latest announcement appears to be a system-alignment measure rather than a substantive legal amendment. Yet, critics argue that such clarifications should ideally be issued through formal circulars, notifications, or CBIC advisories rather than social media posts.

Role of GSTN and Infosys

The GST portal is operated by the Goods and Services Tax Network (GSTN), a not-for-profit company responsible for the IT backbone of GST implementation. Infosys serves as the managed service provider for the portal’s technology infrastructure.

While GSTN regularly issues advisories regarding portal updates and functionality enhancements, the current episode has reignited debate over communication protocols and the boundary between technical implementation and statutory interpretation.

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