What the 57th Council meeting recommended
The 57th GST Council met on 08/10/2026 at New Delhi and recommended what was described as the final lap of the GST 2.0 reforms. Between 26/10/2026 and 30/10/2026, CBIC gave effect to these recommendations.
The changes came through the CGST (Amendment) Rules, 2026, the rate notifications, ten circulars and one instruction. Changes that need amendment of the Act are to follow.
Key takeaways
Refunds: the system takes over more steps
Refund processing is moving from the officer to the system. Acknowledgement, provisional refund and refund of the cash ledger balance will be generated by the portal within fixed days, and where the officer does not act, the application is deemed acknowledged.
| Stage | Existing | Revised |
|---|---|---|
| Acknowledgement (RFD-02 / RFD-03) | Issued within 15 days of filing; otherwise the application stays pending | Issued within 10 days of filing; otherwise deemed acknowledged, and the 60 days for the final order run from the date of filing |
| Provisional refund (RFD-04 / RFD-05) | Officer sanctions 90 per cent of zero-rated claims within 7 days of acknowledgement | System generates RFD-04 within 3 working days of acknowledgement; 90 per cent now covers inverted duty structure claims also |
| Final order (RFD-06) | Officer passes the order within 60 days of acknowledgement | Cash ledger excess refund is sanctioned by the system; every other refund stays with the officer within 60 days |
Outward supply statements now need complete particulars of each invoice and shipping bill, not only the number and date. Invoice-wise ITC details replace the Excel Annexure B, and the non-prosecution declaration goes with every claim. A declaration on capital goods applies from 01/04/2027.
The procedure now turns on the risk score the system assigns to the application. The officer steps in only where the system routes the claim to him, so the quality of invoice-level data filed will decide how fast the refund moves.
Inverted duty structure: a wider Net ITC
Refund under an inverted duty structure was earlier confined to ITC on inputs, meaning goods alone. From 01/11/2026, Net ITC includes ITC on input services, and from 01/04/2027 it includes capital goods over 60 months. The eligibility test is unchanged.
The illustration is a fertiliser manufacturer with output at 5 per cent and inputs at 18 per cent. Its ITC stuck in the ledger each month of Rs. 3.6 lakh becomes nil under the revised rule.
The formula itself is unchanged; what changes is the content of Net ITC.
Registration: e-commerce sellers and amendments
Small sellers supplying goods through e-commerce operators can now register in another State by declaring the operator's warehouse there as the principal place of business. This route is available from 01/11/2026 and needs Aadhaar authentication.
- 1Apply in REG-01
Apply in the other State, quoting the home-State GSTIN and declaring the operator's warehouse as principal place of business.
- 2Operator consent
The operator consents within 7 working days; without consent the application is not processed.
- 3Home-State checks
The home-State officer carries out biometric Aadhaar and document verification, and physical verification of the home-State principal place, if these were not done earlier.
- 4Grant
Registration is granted electronically. If there is no verification in 30 days, it is deemed approved.
Amending registration details
Earlier, every change in a core field waited for the officer's approval. From 01/11/2026, only a change in the principal place of business goes to the officer. Other changes stand amended on submission of REG-14 and online validation.
Where the officer is involved, the amendment takes effect from the date of approval. For system-amended fields, the date of submission is the effective date, so invoices and e-way bills should carry the new particulars from that date.
Voluntary cancellation and non-filers
The revised Rule 20 ties the cancellation application to returns and lets the portal cancel clean cases without the officer. Cases that do go to the officer now have a time limit, with deemed approval if no action is taken.
From 01/04/2027, the portal suspends, cancels and restores registrations for return and bank-account defaults. The officer's route is kept for the remaining grounds.
The 30-day window runs from the REG-31 intimation, which is served only on the portal and by e-mail. Return filing and bank details must be watched for every GSTIN, including dormant ones.
Proof of place of business and processing
Circular 257 lists, premises by premises, the document that is accepted for proof of the principal place of business. It also limits the officer to three grounds of query and sets time limits for deciding applications. It is effective from 26/10/2026.
Time limits for a decision
Where no action is taken within the time limit, the application is deemed approved. The officer may raise a query only where a document is incomplete or illegible, the address does not match or is incomplete or vague.
Is a Udyam or MSME certificate accepted as proof of premises?
No. Udyam or MSME certificates are not accepted as proof, and the officer may not ask for one.
Does the applicant need to live in the State of registration?
No. The applicant need not reside in the State of registration, but both the residential and business addresses must be accurate.
When must a bank account be added?
It is not needed at the time of application. It must be added within 30 days of registration or before the first GSTR-1 or IFF, whichever is earlier.
Returns, ITC and other clarifications
| Form or area | What has changed | Effective |
|---|---|---|
| GSTR-4 (composition annual return) | Due date moved from 30th April to 30th June following the financial year. The return for FY 2026-27 falls due on 30/06/2027. | 01/11/2026 |
| GSTR-5 (non-resident taxable person) | Due date advanced from the 20th to the 13th of the following month. The return for November 2026 is due on 13/12/2026. | 01/11/2026 |
| GSTR-7A (TDS certificate) | Becomes invoice-wise, so the deductee can reconcile TDS ITC against his own invoices. | 01/01/2027 |
| GSTR-3B lock, IMS and ITC statement | Not notified in this round. Targeted for the return for April 2027. | Pending |
Discounts settled by credit note can now reduce taxable value without a pre-supply agreement, where the supplier issues a credit note and the recipient reverses the related ITC. This change to Sections 15(3)(b) and 34 applies from 01/11/2026.
Input service distributors
Circular 260 settles seven issues on input service distributors. Each registration that receives input service invoices for other distinct persons takes its own ISD registration. The ISD distributes only, and the recipient units satisfy the conditions of Sections 16 and 17.
Banks, NBFCs and demo vehicles
Circular 261 says only a GSTIN engaged in accepting deposits or extending loans or advances can opt for the 50 per cent route under Section 17(4). Once one eligible GSTIN opts, all eligible GSTINs on that PAN must follow it. Circular 262 settles ITC on demo vehicles held by authorised agents of vehicle manufacturers.
Adjudication, pre-deposit, exports and others
Other changes at a glance
Need help applying the new refund, registration or ISD rules to your books? Get in touch with Aypa Corporate Solutions.
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