⚠️ GST Advisory Confusion – What’s the Reality?

 


The GST ecosystem continues to evolve with frequent updates, advisories, and system changes. However, sometimes these updates create more confusion than clarity—especially when there is a mismatch between official advisories and what is actually reflected on the GST portal.

One such issue has recently caught the attention of tax professionals across India: the GST Advisory dated 30 January 2026, which highlighted 4 key changes in GSTR-3B, while the GST portal currently reflects only 3 changes, leaving out a crucial element—ITC cross-utilisation.

Let’s break down the issue in detail and understand what it means for taxpayers, professionals, and businesses.

📌 Background of the GST Advisory – 30 January 2026

The GST department issued an advisory on 30th January 2026, outlining four major changes to be implemented in the GSTR-3B return format. These changes were expected to streamline reporting, improve accuracy, and ensure better compliance.

The key highlight among these changes was related to Input Tax Credit (ITC) cross-utilisation, which plays a significant role in tax calculation and liability adjustment.

However, when taxpayers logged into the GST portal to file returns, they noticed something unusual—the portal reflected only three changes, with the ITC cross-utilisation component missing.

❗ The Core Issue: 4 Points vs 3 Points

The confusion arises due to the discrepancy between:

  • 📄 Official GST Advisory (4 changes announced)
  • 💻 GST Portal Implementation (only 3 changes visible)

🔍 Missing Element: ITC Cross-Utilisation

ITC cross-utilisation allows taxpayers to adjust input tax credits across different tax heads (CGST, SGST, IGST) as per prescribed rules. It is a critical component for accurate tax liability calculation.

The absence of this feature or its visibility on the portal raises important questions:

  • Is the change deferred?
  • Is it implemented in the backend but not visible?
  • Should taxpayers manually consider it?
  • Will it impact return filings or future scrutiny?

⚠️ Portal Error LG9079 – Adding Fuel to the Fire

As if the mismatch wasn’t enough, taxpayers and professionals also encountered a portal error code: LG9079.

What does this mean?

While the GSTN has not provided a detailed public explanation for this error, it has been widely reported during return filing attempts. This has led to:

  • Interrupted filings
  • Difficulty in validating returns
  • Increased dependency on trial-and-error filing
  • Confusion regarding correct reporting format

This technical glitch has further blurred the line between what is legally required and what the system allows.

📅 February Clarification – Still Not Enough

Following the confusion, a clarification was issued in February 2026. However, instead of resolving the issue completely, it raised additional concerns:

  • The clarification did not explicitly address the missing ITC cross-utilisation feature
  • No clear guidance on whether taxpayers should follow advisory or portal structure
  • Lack of instructions for correcting previously filed returns

As a result, professionals are left navigating between law, advisory, and system behavior, without a definitive answer.

🤔 Why This Matters for Taxpayers

This issue is not just a technical glitch—it has real implications for compliance and financial reporting.

1. Risk of Incorrect Filing

If taxpayers rely solely on the portal (which shows only 3 changes), they might miss reporting elements mentioned in the advisory.

2. Future Scrutiny & Notices

If the department later enforces the advisory strictly, taxpayers may face:

  • Notices for mismatch
  • Demands for additional tax
  • Interest and penalties

3. Compliance Uncertainty

Professionals are unsure whether to:

  • Follow the advisory strictly
  • Follow the portal practically
  • Maintain parallel workings for safety

📊 Law vs Advisory vs System – The Real Dilemma

This situation highlights a common challenge in GST compliance:

AspectCurrent Scenario
LawAdvisory mentions 4 changes
AdvisoryClearly includes ITC cross-utilisation
SystemReflects only 3 changes

This disconnect creates a grey area where:

  • Legal interpretation differs from system functionality
  • Advisory intent is not fully implemented
  • Taxpayers are left to make judgment calls

📌 What Should Taxpayers Do Now?

Until official clarity is provided, here are some practical steps taxpayers and professionals can follow:

✅ 1. Follow Portal While Filing

Since returns are filed through the GST portal, it is advisable to align with the system format to avoid filing errors.

✅ 2. Maintain Detailed Working Papers

Keep internal documentation of:

  • ITC calculations
  • Cross-utilisation workings
  • Differences between advisory and portal

This will help in case of future audits or notices.

✅ 3. Stay Updated with Notifications

Regularly monitor:

  • GST portal updates
  • Official notifications
  • Circulars and press releases

Changes may be implemented anytime without much notice.

✅ 4. Avoid Aggressive Adjustments

Until clarity is issued, avoid making assumptions or aggressive tax positions based on incomplete implementation.

✅ 5. Consult Professionals

Given the complexity, it’s advisable to seek expert guidance to ensure compliance and risk mitigation.

🔮 What Can We Expect Going Forward?

Based on past GST trends, the following scenarios are possible:

1. System Update

The GST portal may soon be updated to reflect the missing ITC cross-utilisation feature.

2. Detailed Clarification

A comprehensive circular may be issued clarifying:

  • Applicability
  • Filing method
  • Impact on past returns

3. Retrospective Adjustment

Authorities may allow correction of past filings if discrepancies arise due to this confusion.

📢 Final Thoughts

The GST Advisory confusion around GSTR-3B changes highlights a critical issue in tax compliance—the gap between policy and implementation.

While the advisory aimed to improve transparency and reporting, the incomplete portal implementation has led to uncertainty among taxpayers and professionals.

Until official clarity is issued, the safest approach is to:

  • Follow the portal for filing
  • Maintain proper documentation
  • Stay cautious and updated

GST compliance is not just about filing returns—it’s about filing them correctly, with clarity and confidence.

📞 Contact us today: +91 7305701454
📧 Email: auditsiva2@gmail.com
🌐 Website: www.taxlaservices.com

#GSTUpdates #GSTR3B #GSTAdvisory #TaxUpdates #TaxlaServices #ComplianceAlert #GSTIndia #BestAuditorInTamilnadu

Comments

Post a Comment

Popular posts from this blog

🧾 TDS Payment (AO Permitted) – Due Date Alert!

Image
Deadline: 7th July 2025 | Period: April–June 2025 Tax deductors and businesses—this is a timely reminder! If you're permitted to deposit TDS quarterly by your Assessing Officer (AO) under certain provisions of the Income Tax Act, the due date for the April–June 2025 quarter is fast approaching. 🔍 What is AO-Permitted Quarterly TDS Payment? Under normal circumstances, TDS must be deposited monthly. However, specific deductors can obtain permission from the Assessing Officer (AO) to deposit TDS on a quarterly basis —typically to reduce compliance burden for eligible deductors. Quarterly TDS deposit is permitted under the following sections : Section 192 – Salary payments Section 194A – Interest (other than securities) Section 194D – Insurance commission Section 194H – Commission or brokerage If you have this quarterly permission , the due date for April to June 2025 TDS payment is: 🗓 7th July 2025 🚨 What Happens If You Miss the Deadline? Failure to...
Read more

ITC Blocked in Many Cases – Know When You Can’t Claim It

Image
  The Goods and Services Tax (GST) regime allows businesses to claim Input Tax Credit (ITC) on the tax paid for goods and services used in the course of business. This mechanism helps avoid double taxation and ensures a seamless flow of credit through the value chain. However, the GST law also prescribes certain situations where ITC cannot be claimed . These restrictions are outlined in Section 17(5) of the Central Goods and Services Tax (CGST) Act, 2017 . Understanding these rules is crucial for businesses to remain compliant and avoid penalties or unnecessary tax demands. What is Input Tax Credit (ITC)? ITC allows a registered taxpayer to reduce the GST they have paid on purchases from the GST they owe on sales. For example, if a business pays GST on raw materials, they can claim it back while paying GST on the final product, thereby reducing the overall tax burden. But remember — ITC is not an unconditional benefit . If the goods or services are not used for business purp...
Read more

New Tax Rule Alert! – Tax Officials Can Access WhatsApp & Email During Searches

Image
The Government of India has introduced a significant provision under the New Income Tax Bill 2025 , granting tax officials the authority to access digital communication platforms like WhatsApp, email, and cloud storage apps during search and seizure operations . 📜 Key Provisions of the Rule: Expanded Access Rights Tax officials can now inspect your WhatsApp chats, email inbox, cloud storage files, and installed applications on your devices during income tax searches. This move aims to enhance investigation efficiency and curb tax evasion through digital means. Parliamentary Panel Approval A Parliamentary Standing Committee reviewed the clause and raised no objections in its official report dated 21 July 2025 . The inclusion of this clause highlights the government’s focus on modernizing enforcement by including digital evidence in tax cases. Applicable During Official IT Raids Access is permitted only during authorized searches under Section 132 of the...
Read more