57th GST Council Recommends Faster, System-Based Automated Processing of GST Refunds

The 57th Meeting of the GST Council was held on October 08, 2026, in New Delhi, under the chairpersonship of the Union Finance & Corporate Affairs Minister, Smt. Nirmala Sitharaman. At the meeting, the GST Council made recommendations relating to process reforms, primarily covering registration, returns, refunds and adjudication; clarifications regarding the applicability of GST on supplies of certain goods and services; and other measures for trade facilitation and streamlining GST compliances.

Faster, system-based automated processing of refunds: The GST Council recommended amendments in section 54 of the CGST Act, 2017 and the relevant CGST Rules, 2017, to provide for system-based processing and sanctioning of refund claims, pertaining to excess balance in electronic cash ledger, zero-rated supplies, and inverted duty structure, in the following two phases.

Phase 1:

• Full refund claim of excess balance in the electronic cash ledger will be sanctioned automatically by the system, without officer intervention.
• Time limit for issuance of acknowledgement or deficiency memo to be reduced from 15 days to 10 days. Deemed acknowledgement by the system, where such acknowledgement or deficiency memo is not issued by the proper officer within 10 days of the application.
• For refund claims on account of zero-rated supplies and inverted duty structure, 90% of the amount claimed will be sanctioned on provisional basis automatically by the system, without officer intervention, on the basis of identification and evaluation of risk by the system.

Phase 2:

• System-based automated acknowledgment (without officer intervention) on due verification of the refund application by the system.
• In such acknowledged cases, automated sanction of full refund claim by the system (without officer intervention), in respect of claims pertaining to zero rated supplies, after adjusting pending dues, if any, on the basis of identification and evaluation of risk by the system.

These measures will streamline and expedite refund processing through greater automation and reduced manual intervention, thereby facilitating timely sanction of eligible refunds and reducing compliance burden for taxpayers as well as interface with the department. Introduction of automation will ensure transparency, certainty, and uniformity and will also improve cash flows for taxpayers.

The Press Release can be accessed at:  https://www.pib.gov.in/PressReleaseDetail.aspx?PRID=2320934&reg=48&lang=1