The Central Board of Indirect Taxes and Customs (CBIC) has notified a series of amendments to the Goods and Services Tax (GST) framework, expanding reverse-charge provisions for specified categories of waste and scrap and updating compliance requirements. Most changes will take effect from November 1, 2026, while some e-invoicing amendments will come into force from January 1, 2027.
The government has notified the Central Goods and Services Tax (CGST) (Amendment) Rules, 2026, covering e-commerce registration, registration procedures, returns, the composition levy and various GST forms. The amendments will take effect from different dates, with November 1, 2026, being the general commencement date unless otherwise specified.
It has also amended e-invoicing provisions to cover specified supplies received from unregistered persons under the Reverse Charge Mechanism (RCM) and imports of services, in addition to business-to-business (B2B) supplies and exports. These changes will take effect from January 1, 2027. Under the reverse-charge mechanism, the liability to pay GST shifts from the supplier to the recipient in specified transactions.
CBIC has also issued a clarification on the 50% input tax credit (ITC) option available to banks and non-banking financial companies (NBFCs), stating that institutions opting for the mechanism must apply it across all their eligible GST registrations. The move is aimed at addressing inconsistencies in credit reporting.
Eligible banks and financial institutions can claim 50% of their eligible ITC under this option instead of calculating credit proportionately based on taxable supplies. However, applying the option across multiple GST registrations has posed practical challenges, particularly for institutions with diversified operations.
Manoj Mishra, Partner and Tax Controversy Management Leader at Grant Thornton Bharat, said the clarification addresses longstanding uncertainty over the scope of the option, inter-branch supplies and ITC reporting in GST returns.
“The relaxation permitting full ITC on transactions between registrations under the same PAN is available only where both registrations have opted for the 50% ITC mechanism, which is a significant consideration for financial institutions managing shared services and inter-branch transactions across multiple GSTINs,” Mishra said.