CBIC Notifies 1 November 2026 as Date for CGST Amendments on Discounts and Refunds
The Central Board of Indirect Taxes and Customs (CBIC) has appointed 1 November 2026 as the date on which Sections 153 to 155 of the Finance Act, 2026 will come into force. The CBIC issued the notification on 26 October 2026, using powers under Section 1(2)(b) of the Act.
These provisions amend the Central Goods and Services Tax Act, 2017 (CGST Act), changing the framework for post-supply discounts, credit notes and GST refunds.
Under the amendments, Section 15(3)(b) of the CGST Act now provides that post-supply discounts may be excluded from the value of supply if two conditions are met: the supplier has issued a credit note, and the recipient reverses the input tax credit corresponding to that discount, in line with Section 34.
Section 34(1) has been amended to expressly allow a credit note to be issued when a discount referred to in Section 15(3)(b) is granted after the supply has been made.
Two changes concern refunds. Section 54(6) has been amended to extend the provisional refund framework to refunds of unutilised input tax credit allowed under clause (ii) of the first proviso to Section 54(3). Section 54(14) has been amended to create an exception for refund claims relating to goods exported out of India with payment of tax.
The amendments link valuation benefits for post-supply discounts to the issuance of credit notes and the reversal of the corresponding input tax credit by recipients, providing a clearer statutory framework for their GST treatment. They also broaden the scope of provisional refunds and add clarity on refund claims involving unutilised input tax credit and exports.
Source: SCC Times