(1) The amount available in the electronic credit ledger may be utilized for effecting payment towards output tax payable under the Act or Rules. The manner of utilization, conditions and timelines have been specifically prescribed.
(2) As per the section 49A, the ITC of IGST has to be utilized completely before ITC of CGST / SGST or UTGST can be utilized for discharge of any tax liability.
(3) Rule 88A also allows utilization of ITC of IGST towards the payment of CGST and SGST, or as the case may be, UTGST, in any order subject to the condition that the entire ITC on account of IGST is completely exhausted first before the ITC on account of CGST or SGST / UTGST can be utilized.
(4) ‘Cross-utilization of credit is not available’ means important restriction is that the CGST credit cannot be utilized for payment of SGST or UTGST and vice versa. One may note the fact that IGST credit is available seamlessly,
subject to order of utilization as mentioned above.
(5) Electronic credit ledger has the following credit utilization arrangement as per combined reading of sections 49(5),49A,49B, Rule 88A and Circular No. 98/17/2019 GST, dated 23.04.2019:
