Changes in the GST portal’s rules for using input tax credit (ITC) to pay integrated goods and services tax (IGST) dues have left taxpayers confused, prompting the Madhya Pradesh Tax Law Bar Association to seek clarity from the state tax department.
In a memorandum submitted to commercial tax and state GST, Indore on Friday, the association said frequent changes in GSTN advisories and corresponding tweaks in the portal have led to uncertainty in return filings.
“The inconsistency between the portal functionality and advisory changes has created confusion among taxpayers, who have filed returns based on the system’s behaviour at that point in time,” the association president said.
The CGST Act prescribes a clear order for utilisation of ITC while offsetting IGST liability, giving priority to CGST credit over SGST. However, a GSTN advisory issued on Jan 30, 2026 allowed taxpayers to use CGST and SGST ITC against IGST liability in any order. The portal was also aligned accordingly for Feb filings.
The issue arose when, with March returns, the portal reverted to the earlier statutory sequence. The earlier advisory was also edited on the portal, leaving taxpayers unsure about the validity of returns already filed.
The association has urged authorities to treat ITC utilisation done in Feb 2026 as valid and to apply any changes only prospectively. It has also sought protection for taxpayers from any demand, interest or penal action arising out of the issue.
Calling for a clear circular, the association said uniform guidelines are needed to avoid future disputes and ensure taxpayers can fully utilise available ITC without ambiguity in the adjustment sequence across IGST, CGST and SGST heads.
Source from: https://timesofindia.indiatimes.com/city/indore/gst-portal-flip-flop-on-itc-use-sparks-confusion-mp-tax-bar-seeks-clarity/articleshowprint/130342301.cms
