56th GST council meeting announcements (apart from rate revision)

1. Simplified GST Registration

Applicable to whom: Businesses with monthly tax liabilities under ₹2.5 lakh.
Effective Date: November 1, 2025.

Earlier, sellers (especially those on e-commerce platforms) had to register in every state where they sold goods. This was costly and complex.
With this amendment, they can now operate pan-India with a single registration, reducing compliance burden. No need for a principal place of business in every state.

2. Removal of Section 13(8)(b) of IGST Act

Applicable to whom: Indian service providers acting as intermediaries.
Effective Date: September 22, 2025.

In case of exports, place of supply for intermediary services (eg consultants, brokers) provided to an export supplier was held as the location of the supplier.
With this amendment, this provision is omitted, meaning the recipient’s location determines the place of supply. Benefit from this amendment is, the Indian service providers acting as intermediaries can now treat their services as exports, if the recipient is outside India. This makes them eligible for zero-rated GST, unlocking refund benefits.

3. Credit Notes for Post-Sale Discounts

Applicable to whom: Registered businesses
Effective Date: September 22, 2025.

Previously, post-sale discounts couldn’t be adjusted from the invoice value, unless they were part of the original contract.
Subsequent to this amendment, Businesses can now issue credit notes for post-sale discounts, even if the discount wasn’t pre-agreed in the original invoice and Input Tax Credit will be reversed proportionately.
Exception: Post-sale discount linked to specific services such as co-branding or promotions cannot be adjusted.

4. GST Appellate Tribunal (GSTAT) Operationalization

Applicable to whom: All Taxpayers seeking to appeal against GST orders passed by adjudicating authorities or appellate commissioners.
Effective Date: December, 2025.

Currently, taxpayers face delays due to lack of a dedicated appellate body.
GSTAT shall start accepting appeals beginning September 2025 and the hearings shall begin by December 2025. Note that 30th June 2025 shall be the Cut-off Date for Filing Backlog Appeals.

5. Refund Reforms

Inverted Duty Structure cases (IDS)
Applicable to whom: Exporters and businesses with Inverted Duty Structure (IDS) claiming GST refunds.
Effective Date: 01st November, 2025.

Prior to the amendment, all refund claims underwent manual scrutiny by tax officers, often leading to delays, inconsistent processing, and increased compliance burden for businesses.

With this amendment, 90% of eligible refunds shall be granted provisionally within days,based on AI/ML (system)-driven risk assessment. This reduces manual scrutiny and speeds up processing. Full scrutiny will be done only in high risk cases.
Exporters and businesses with inverted duty structures (where input tax is higher than output tax) will get faster liquidity consequently reducing the working capital stress.

Courier/Post Exports:
Refunds allowed for low-value consignments (≤ ₹1,000)
Effective Date: 01st November, 2025.

Before the amendment, GST refunds were not permitted for export consignments valued below ₹1,000, especially those sent via courier or post.
With this amendment, Refunds are allowed even for low-value consignments (value ≤ ₹1,000).

Formal reaffirmation and clarification of existing provisions

6. E-Way Bill Continuity

Applicable to whom: To all registered businesses transporting goods during GST rate transitions.
Effective Date: 22nd September, 2025.

Clarification: No need to regenerate E-Way Bills for the ‘goods in transit’ during GST rate changes.
Impact: Smooth logistics and reduced compliance burden.

7. Revised MRP Disclosure Rules for Unsold Stock

Businesses must immediately revise MRPs on unsold inventory, when GST rates change. Revised prices must be affixed via stickers, stamping, or online printing and issue advertisement in at least two newspapers to inform consumers.

This Ensures consumers benefit from rate reductions and Prevents profiteering by selling old stock at inflated prices post-rate cut.

8. Time of Supply Clarification for Fixed-Price Contracts

It is “the time of supply” that has always determined the applicable GST rate and not the date of contract. This principle was clearly provided in the law but often misunderstood or misapplied, especially in long-term contracts.

Accordingly, If the invoice or payment occurs after a rate change, the new rate applies, even if the contract was signed earlier.

9. Pharma Sector Compliance via NPPA

For medicines and medical devices under price control, National Pharmaceutical Pricing Authority (NPPA) mandates pharmaceutical companies to Issue revised price lists in form V/VI to retailers and regulators.

If price compliance cannot be ensured at the retail level, companies may be required to recall, re-label, or re-sticker the unsold stock already in the market. No need to recall stock if retailers comply.

10. Refund Restriction Clarification

Inverted duty structure means business pays more tax on inputs than the tax it collect on sales. This creates unused ITC, which can be claimed as a refund under IDS.

This refund can be claimed only if the inversion is structural. If the output tax rate was recently reduced, causing a mismatch, that’s not a structural inversion. It’s a rate-change anomaly, and under the 56th GST Council clarification, refunds won’t be allowed in such cases.