The GST portal has quietly modified its earlier advisory on ITC utilisation, removing the much-discussed facility of cross-utilisation of input tax credit (ITC) without issuing any formal clarification or notification. The change, which directly impacts the manner in which taxpayers discharge their tax liabilities in GSTR-3B, has raised serious questions on transparency and legal certainty.
The original advisory dated January 30, 2026 had introduced a key update under Table 6.1 of GSTR-3B, stating that once IGST ITC is fully exhausted, taxpayers would be allowed to utilise CGST and SGST credits in any sequence to pay IGST liability. This effectively enabled flexibility in cross-utilisation, allowing adjustment of SGST against IGST even without fully utilising CGST first—a position that deviated from the strict order prescribed under Section 49 of the CGST Act.
However, in a surprising move, the GST portal has now silently removed this specific cross-utilisation point from the same advisory. While the link and date of the advisory remain unchanged, the content has been altered, reducing the number of key points from four to three. The omission of the cross-utilisation provision has created confusion, especially since no official communication or corrigendum has been issued to explain the change.
Adding to the uncertainty is the inconsistent stance taken by the portal over the past few months. Initially, it was indicated that the new ITC utilisation logic would apply from the January GSTR-3B return. Subsequently, this was deferred to February filings. Now, with the advisory itself being modified without notice, taxpayers are left without clarity on the applicable rules.
But Now: GST Monthly E-Compilation : March 2026
The situation becomes particularly critical for those taxpayers who have already filed their February GSTR-3B returns by relying on the portal’s earlier functionality and advisory. The absence of any formal clarification raises concerns about possible disputes, interest exposure, or demands arising from a system-driven position that is no longer reflected in official guidance.
From a legal standpoint, such silent modifications without proper notification or amendment to statutory provisions undermine the principle of certainty in tax administration. The GST framework, being largely technology-driven, places significant reliance on portal behaviour and advisories. Any retrospective or unexplained changes not only erode taxpayer confidence but may also lead to unnecessary litigation.
Experts are now calling for immediate clarification from the GSTN and the CBIC on the applicable position of ITC utilisation, particularly regarding the validity of returns already filed and the treatment of cross-utilisation during the interim period.
Until such clarity is provided, taxpayers and professionals are advised to exercise caution and closely monitor further updates, as the issue has the potential to impact compliance positions across a wide base of businesses.
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