FAQs on the decisions of the 56th GST Council Meeting
by Reina Legal | Sep 8, 2025
The Ministry of Finance has issued a set of frequently asked questions (FAQs) on the decisions of 56th GST Council Meeting to provide clarification on certain queries. The key clarifications are summarized hereinbelow:
| Queries |
Clarifications |
| When will the revised GST rates come into force? |
- Revised GST rates on goods and services (except tobacco products) will come into effect from 22nd September 2025
- For tobacco products (cigarettes, chewing tobacco, zarda, beedi), current rates will continue until loan and cess-related liabilities are fully discharged; revised rates will be notified separately
|
| What is the time of supply in case of rate change? |
Supplies made before the rate change but invoiced afterwards, time of supply will be:
- If payment is received after the change in rate of tax – Date of receipt of payment or the date of issue of invoice, whichever is earlier
- If payment is received before the change in rate of tax – Date of receipt of payment
|
| What is the GST rate applicable on advances or incomplete supplies? |
Where supply is not completed and invoices are not issued before 22nd September 2025, GST rate will be determined as per the time of supply provisions under Section 14 of the CGST Act |
| What will be impact on Input Tax Credit (ITC)? |
- ITC can be claimed on inward supplies at the rate prevailing at the time of such supply
- ITC already availed and credited in the e-credit ledger can be utilised for discharge of output tax liability, even if rates on outward supplies are reduced subsequently
- Outward supplies which becomes exempt post rate change i.e., on or after 22nd September 2025, ITC attributable to such supplies will have to be reversed
|
| Can refund be claimed under inverted duty structure? |
- Refund of accumulated ITC under Section 54(3) of the CGST Act is available where credit has accumulated due to rate of tax on inputs being higher than that on output supplies
- However, cases where input and output are the same but attract different rates at different points of time do not qualify for such refunds
|
| How will stock and goods in transit be treated? |
- Goods or services supplied on or after the effective date of revised GST rates, the new GST rates will apply regardless of whether stock was purchased earlier
- E-way bills already generated for goods in transit are valid and there is no mandatory requirement for cancellation and fresh generation due to rate changes
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Click to download the FAQs Document
