Practice note · 2026-11-10 · By CA Arun Mehta
GSTR-2B and GSTR-3B: What the Law Lets You Claim, and the 30 November Cut-off
Input tax credit may be taken only for invoices that the supplier has reported and that appear in the recipient's GSTR-2B (section 16(2)(aa) and rule 36(4)), and GSTR-3B Table 4(A) is populated from the 2B. A mismatch therefore means credit claimed beyond the 2B, or reversals and ineligible credit not carried correctly. For FY 2025-26, credit must be taken by 30 November 2026 (section 16(4)), and credit on invoices whose supplier has not filed GSTR-3B by 30 September 2026 must be reversed under rule 37A by 30 November 2026.
The existing note on DRC-01B and DRC-01C deals with what happens after the portal has noticed a difference. This one is about the rule underneath it, and about two dates in November that a recipient has to meet before the year closes.
What the 2B is
Rule 60(7) provides for an auto-generated statement of input tax credit, FORM GSTR-2B, made available each month. It is built from what suppliers have reported in GSTR-1 or the invoice furnishing facility between one due date and the next, together with the other documents the rule lists. CBIC's Circular 170/02/2022-GST of 6 July 2022 records that the 2B has been a static month-wise statement since August 2020, and that GSTR-3B has been auto-generated since December 2020, with credit in Table 4 filled from the 2B and open to editing by the registered person.
So the 3B does not start from a blank page. It starts from the 2B, and every edit away from it is a decision the registered person has taken.
The rule that makes it binding
For a time it was a matter of practice. It is now the law.
| Position | |
|---|---|
| Before 1 January 2022 | The last form of rule 36(4) allowed credit on invoices not reported by the supplier up to 5 per cent of the eligible credit on invoices that were reported |
| From 1 January 2022 | Section 16(2)(aa) makes credit conditional on the supplier having furnished the invoice details in the statement of outward supplies and on their having been communicated to the recipient. Rule 36(4) is substituted: no credit on invoices or debit notes required to be reported under section 37(1) unless they are in the supplier's GSTR-1 (as amended in GSTR-1A, if any) or the invoice furnishing facility, and communicated to the recipient in the 2B |
| From 1 October 2022 | Section 16(2)(ba) adds that the credit details communicated to the recipient under section 38 must not have been restricted |
The rule is framed around invoices and debit notes that suppliers must report under section 37(1). A bill of entry is a separate document under rule 36(1), and the circular records that import credit is in the 2B in any case.
What carries from the 2B to the 3B, and what does not
Circular 170/02/2022-GST sets out the procedure for Table 4 of the 3B.
| Where | What goes there |
|---|---|
| Table 4(A) | Credit from the 2B, eligible and ineligible, except credit barred by the time limit in section 16(4) and credit on an intra-State supply where the place of supply is in another State. Those two are not populated into 4(A) and are shown, if at all, in 4(D)(2) |
| Table 4(B)(1) | Reversals that are final: rules 38, 42 and 43, and credit barred by section 17(5) |
| Table 4(B)(2) | Reversals that can be reclaimed: rule 37 (non-payment to the supplier), and section 16(2)(b) and (c) |
| Table 4(C) | Net credit, 4(A) less 4(B), which is credited to the electronic credit ledger |
| Table 4(D) | Credit reclaimed under 4(A)(5) is shown in 4(D)(1); credit not available because of the time limit or the place of supply in 4(D)(2) |
Nothing in that circular makes a difference between 2B and 3B wrong in itself. The question is whether each part of the difference has a place in the table.
Where a difference comes from
- Credit in the 3B and not in the 2B. The supplier has not reported, or has reported late. Rule 36(4) bars it.
- Credit in the 2B and not in the 3B. Not yet claimed, or taken out as ineligible under section 17(5), or reversed under rule 42 or 43, or held back under section 16(2)(b) because the goods have not been received.
- Credit reversed under rule 37. The recipient has not paid the supplier within 180 days. Rule 37 requires reversal with interest in the return for the period after the 180 days, and allows the credit to be re-availed on payment. Rule 37(4) says the section 16(4) time limit does not apply to that re-availment.
- Credit barred by time or place of supply. The 2B itself flags these in Table 4.
GSTN's FAQ on the annual return says that documents accepted or deemed accepted in the Invoice Management System are the ones that appear in the 2B, so action taken there bears on what the 2B shows.
The two dates in November
Section 16(4). No credit may be taken on an invoice or debit note after the 30th of November following the end of the financial year to which it pertains, or the furnishing of the relevant annual return, whichever is earlier. For FY 2025-26 that is 30 November 2026. For a registered person filing monthly, the return for October 2026, if it is filed on or before 30 November, is the last that can carry credit on an invoice of this year. A document of the year that first appears in the 2B for November 2026 or later is out of time, and the 2B shows it as not available.
The words "whichever is earlier" matter. On their face, furnishing the annual return before 30 November closes the window early. That is our reading of the text. A registered person with credit still to be taken should not file the GSTR-9 for the year until it has been.
Rule 37A. Where credit has been availed on an invoice whose details the supplier reported in GSTR-1, but the supplier's GSTR-3B for the corresponding period has not been furnished by 30 September following the end of the year, the recipient must reverse the credit in a GSTR-3B filed on or before 30 November. If it is not reversed by then it is payable with interest under section 50. When the supplier later files, the credit can be re-availed. The rule was inserted by Notification 12/2024-Central Tax of 10 July 2024.
GSTN's tutorial on the 2B says the portal calculates this amount and shows it in the ITC Reversal tab of the 2B, from invoices and debit notes of the periods for which the supplier's 3B is not filed, excluding reverse charge invoices and credit notes. That figure is where the check should begin.
If a DRC-01C arrives
Rule 88D applies where credit availed in the 3B exceeds the credit available in the 2B by such amount and such percentage as the Council recommends. The recipient has seven days to pay the excess through DRC-03 with interest, or to explain in Part B. Failing that, the amount is liable to be demanded under section 73, section 74 or section 74A, and rule 59(6)(e) stops the next GSTR-1 or invoice furnishing facility until a reply is made. The existing note on DRC-01B and DRC-01C sets out what a Part B reply can properly say.
What is proposed, and what is not yet law
The Press Information Bureau's note of 9 October 2026 on the 57th Council meeting lists proposals on returns: a mechanism to report or correct credit in the 3B so that it aligns with the 2B, an electronic statement of credit reversed and reclaimed, and a circular on how credit and its reversal are to be reported. It says the alternate mechanism is proposed to apply from the April 2027 return period.
Those are proposals. The CGST (Amendment) Rules, 2026, notified on 26 October 2026 as Notification 05/2026-Central Tax, change rule 36 only for credit distributed by an Input Service Distributor, and do not amend rule 88D. The forms substituted from 1 April 2027 for DRC-01 and DRC-01A list a mismatch under rule 88D as one of the proceedings that can precede a show-cause notice.
Before the month closes
- Take the 2B for each month of the year, and compare Table 4(A) of the 3B to it. They should agree unless the 3B was edited.
- For each edit, find the table it belongs to under the circular: 4(B)(1), 4(B)(2) or 4(D).
- List the invoices of the year that the suppliers have not yet reported, and chase them before 30 November. After that date the credit is lost whatever the supplier does.
- Look at the rule 37A amount in the ITC Reversal tab, and reverse it in the return filed by 30 November.
- Do not file the annual return for the year until the credit position has been settled.
This note is general information drawn from the Act, the Rules, notifications and circulars as published on the CBIC and GST portals up to 10 November 2026. It is not advice on your matter, and it cites no decided case.
Questions this answers
- Can I claim credit on an invoice that is not in my GSTR-2B?
- Not on the text of the law. Section 16(2)(aa) makes credit depend on the supplier having reported the invoice and the details having reached the recipient, and rule 36(4), in force since 1 January 2022, bars credit on invoices that are not in the supplier's GSTR-1 and in the recipient's GSTR-2B. The earlier allowance of 5 per cent on unreported invoices no longer exists. If the supplier reports the invoice later, the credit can be taken when it appears in a later 2B, subject to section 16(4).
- Is there a problem if GSTR-3B shows less credit than GSTR-2B?
- Not under rule 88D, which looks only at credit availed in excess of credit available. A lower claim leaves credit unclaimed, which can be taken later, but only up to the section 16(4) date. Some of the difference is also proper, because ineligible credit and reversals are taken out in Table 4(B) before the net credit reaches the ledger.
- What is the last date to claim credit for FY 2025-26?
- Under section 16(4), the 30th of November following the end of the financial year, or the date the annual return is furnished, whichever is earlier. For FY 2025-26 that is 30 November 2026.
- What must be reversed at the year-end?
- Under rule 37A, credit availed on an invoice whose supplier has not furnished the GSTR-3B for the corresponding period by 30 September following the end of the year must be reversed in a GSTR-3B filed by 30 November, or paid back with interest under section 50. It can be re-availed once the supplier files.
More practice notes
- GSTR-9 and GSTR-9C for FY 2025-26: Who Must File, and Why a Late 9C Is a Late Annual ReturnGSTR-9C is now a self-certified statement, not an audit, and the Board treats the annual return as incomplete until it is filed. That makes a late 9C a late annual return for the purpose of the late fee.
- Tax Audit: Section 44AB Gives Way to Section 63, and the Penalty Becomes a FeeThe limits did not move when the Income-tax Act, 2025 replaced section 44AB with section 63. The consequence of default did, and the change matters more than the limits.
- Cash Deposits and Section 69A: What the Tribunal RequiresNearly ten years on, the November 2016 deposits are still being decided - and the Tribunal does not agree with itself on whether the books must be rejected before section 69A can be invoked.
Holding one of these yourself?
Every assessment turns on its own record. A note like this one tells you what the tribunals have accepted; it cannot tell you whether your papers carry it. Bring the notice in before the reply is drafted, not after.
Notice Assessment Session — 30 minutes, ₹5,000 + gst. A defence outline: the points to take, the documents to assemble, and the date each step falls due.