Last updated: 24 September 2026. If you availed input tax credit in FY 2025-26 on an invoice your supplier reported in GSTR-1 or IFF, and that supplier has not filed the GSTR-3B for the same tax period by Wednesday, 30 September 2026, Rule 37A of the CGST Rules requires you to reverse the credit in a GSTR-3B you file on or before 30 November 2026. If you miss that, the amount becomes payable with interest under Section 50. Once the supplier files, you can take the credit back.
Applicability Note: This guide is based on GST provisions applicable as of 24 September 2026. The 57th GST Council meeting is reported to be scheduled for 7 October 2026. Always verify the current position on gst.gov.in or with a GST professional before taking action.
Who Should Care?
This applies to:
- Any regular taxpayer who claimed ITC in FY 2025-26 on purchases from small or irregular suppliers
- Finance teams that close ITC from GSTR-2B, where an invoice can show up in 2B even though the supplier never filed the return that pays the tax on it
- QRMP filers, whose last GSTR-3B before 30 November falls much earlier than a monthly filer's
- Suppliers running late on GSTR-3B, because this Wednesday decides whether your customers have to reverse their credit
1. What Rule 37A Requires
Rule 37A was inserted by Notification No. 26/2022-Central Tax dated 26 December 2022. Three facts have to line up before it applies:
- You availed ITC in a GSTR-3B on an invoice or debit note.
- Your supplier reported that document in GSTR-1 (as amended in GSTR-1A, if any) or through IFF. This is why the invoice reached your GSTR-2B.
- The supplier has not furnished the GSTR-3B for the matching tax period by 30 September following the end of the financial year in which you availed the credit.
If all three hold, you reverse that credit in a GSTR-3B you furnish on or before 30 November of the same year.
Where the rule comes from: Section 41(2) of the CGST Act says credit on supplies whose tax "has not been paid by the supplier" must be reversed with interest "in such manner as may be prescribed". Rule 37A is that manner. Section 41 took its present form under section 106 of the Finance Act, 2022, in force from 1 October 2022 by Notification No. 18/2022-Central Tax dated 28 September 2022. Section 16(2)(c) makes actual payment of the tax a condition for ITC, subject to Section 41.
Some commentary dates Rule 37A from 1 October 2022. The notification doesn't support that. Only its amendments to Rule 37 carry a 1 October 2022 date. Rule 37A carries none, so it took effect when the notification was published on 26 December 2022.
The rule's title speaks of "non-payment of tax by the supplier", but the test it actually applies is simpler: has the supplier filed the GSTR-3B for that period? That is something you can check.
2. Which Financial Year Counts
This is where people most often misread the rule. The year that matters is the year you availed the credit, not the year of the invoice.
Take an invoice dated 25 March 2025, which is FY 2024-25. You received the goods in April and claimed the credit in your April 2025 GSTR-3B, which is FY 2025-26. That credit falls in this year's cycle. The question is whether your supplier has filed GSTR-3B for March 2025 by 30 September 2026. If not, you reverse it by 30 November 2026.
The reverse also holds. An FY 2025-26 invoice you only claimed in, say, May 2026 falls in next year's cycle, with a cut-off of 30 September 2027.
3. The FY 2025-26 Calendar
| Date | What happens | Source |
|---|---|---|
| Wednesday, 30 September 2026 | Supplier's cut-off to furnish GSTR-3B for the periods behind ITC you availed in FY 2025-26 | Rule 37A |
| On or before 30 November 2026 | Reverse the credit in a GSTR-3B furnished by this date | Rule 37A |
| After 30 November 2026 | Unreversed amount payable with interest under Section 50 | Rule 37A, first proviso |
| Any time after the supplier files | Re-avail in a later GSTR-3B | Rule 37A, second proviso |
The legal test is a GSTR-3B you furnish on or before 30 November 2026, so work backwards from your last regular return before that date:
- Monthly filers: the October 2026 GSTR-3B, due 20 November 2026.
- QRMP filers: the July–September 2026 quarterly GSTR-3B, due 22 or 24 October 2026 depending on your State. Your October–December return isn't due until January 2027, which is too late.
30 November 2026 also matters for a different reason. Under Section 16(4), you can't take ITC on an FY 2025-26 invoice after that date (or after filing the annual return, if earlier). That is a separate rule with a separate trigger, so don't mix the two up on your reconciliation sheet.
4. How to Find the Exposed Invoices Before Wednesday
You have five days before the cut-off, and that time is best spent chasing suppliers rather than preparing reversals. Credit that never has to be reversed saves you two GSTR-3B entries.
- List the FY 2025-26 credit by supplier and tax period. Use what you actually availed in GSTR-3B, not just what appeared in GSTR-2B.
- Check each supplier's GSTR-3B filing status for those periods. Any supplier with a gap is your exposure.
- Write to those suppliers now. Name the periods and the credit amount at stake. A supplier who files by Wednesday, 30 September 2026 takes the invoice out of Rule 37A altogether.
- After the cut-off, open the ITC Reversal tab in GSTR-2B. According to the GST portal's user manual, its ITC REVERSED, B2BA ITC REVERSAL, B2B DNR and B2B DNRA tables list documents "on which ITC to be reversed on account of Rule 37A". The portal works that figure out from your GSTR-2B for the period the supplier left unfiled.
Treat the portal figure as a starting point, not the answer. The rule applies to credit you availed. If you left an invoice out of your claim, or claimed it in a different year, your number will differ from the system's. In 2023, GSTN emailed taxpayers a system-computed Rule 37A amount for FY 2022-23 (advisory dated 14 November 2023). Don't wait for a similar email this year. Nothing on the portal says one is coming.
Our guide to GSTR-2B reconciliation before GSTR-3B covers the matching process in detail.
5. Where the Reversal Goes in GSTR-3B
Circular No. 170/02/2022-GST dated 6 July 2022 puts reversals that are "not permanent in nature and can be reclaimed" in Table 4(B)(2). It names reversals under Rule 37 and Sections 16(2)(b) and 16(2)(c). The circular predates Rule 37A, but GSTN's 14 November 2023 advisory told taxpayers to make Rule 37A reversals in Table 4(B)(2). When you re-avail, the credit goes in Table 4(A)(5) and is also shown in Table 4(D)(1).
Each 4(B)(2) entry feeds the Electronic Credit Reversal and Re-claimed Statement, which GSTN introduced by an advisory dated 31 August 2023. A GSTN advisory dated 29 December 2025 announced a hard validation: your 4(D)(1) reclaim cannot exceed the statement's closing balance plus the current period's 4(B)(2). As of 24 September 2026 no activation date has been published, but a Rule 37A reversal logged correctly now is what keeps your later reclaim within that limit. Our Table 4 reversal and reclaim guide walks through the statement.
6. Missing the Deadline, and Getting the Credit Back
If you do not reverse by 30 November
Under the first proviso to Rule 37A, the amount becomes payable along with interest under Section 50. The rule does not say which sub-section of Section 50 applies, and neither will we.
Re-availment
Under the second proviso, once the supplier furnishes the GSTR-3B for that period you may re-avail the credit in a GSTR-3B for a later tax period. The trigger is the supplier filing, which is different from the payment trigger in Section 41(2)'s proviso. Rule 37(4) says the Section 16(4) time limit doesn't apply to re-availing credit that was reversed under the Act or that Chapter of the Rules. Rule 37A is in that Chapter, so re-availment in 2027 is not barred by the 30 November 2026 limit.
A worked example
Mehta Fabricators, a monthly filer, availed ₹1,80,000 of ITC in FY 2025-26 on invoices from one supplier covering November 2025 to February 2026. The supplier reported all of them in GSTR-1 but filed GSTR-3B only for November and December 2025.
| Supplier's tax period | ITC availed | Supplier's GSTR-3B by 30 Sep 2026? | Rule 37A reversal |
|---|---|---|---|
| November 2025 | ₹48,000 | Filed | Nil |
| December 2025 | ₹42,000 | Filed | Nil |
| January 2026 | ₹54,000 | Not filed | ₹54,000 |
| February 2026 | ₹36,000 | Not filed | ₹36,000 |
| Total | ₹1,80,000 | ₹90,000 |
Mehta reverses ₹90,000 in Table 4(B)(2) of its October 2026 GSTR-3B, filed on 20 November 2026. The supplier then files its January 2026 GSTR-3B in December 2026. Mehta re-avails ₹54,000 in a GSTR-3B for a later period, reporting it in Tables 4(A)(5) and 4(D)(1). The ₹36,000 for February stays reversed until that return is filed as well.
7. What Rule 37A Does Not Catch
Rule 37A asks one question: was the GSTR-3B filed? A supplier who filed GSTR-3B but reported less tax than its GSTR-1 showed passes that test. Your credit on those invoices is still exposed under Section 16(2)(c) and Section 41(2). That exposure usually shows up later, in a notice, rather than in a reversal table.
Courts have not been sympathetic to buyers here. In Maruti Enterprise v. Union of India (Gujarat High Court, 1 May 2026), a Division Bench upheld Section 16(2)(c), including against purchasers who acted in good faith. Reports of the judgment say the Court pointed to the reversal-and-re-availment route in Section 41(2) and Rule 37A as the buyer's safeguard. In July 2026 the Supreme Court dismissed the special leave petitions against that view in Bhandari Scrap Traders v. Union of India (SLP (C) No. 23931 of 2026). The practical point: re-availment is the remedy the law gives you, so keep your reversal records clean enough to use it. For the full list of ITC conditions, see our guide to Section 16 conditions for input tax credit.
8. Other Dates This Week
- Friday, 25 September 2026: PMT-06 for August 2026. QRMP filers pay tax for Month 2 of the July–September quarter (Notification No. 85/2020-Central Tax dated 10 November 2020).
- Monday, 28 September 2026: GSTR-11 for UIN holders, for the month of August.
No extension had been announced on the GST portal as of 24 September 2026. Subject to notification changes, so verify on the GST portal before filing.
Key Takeaways
- Rule 37A applies where your supplier reported the invoice in GSTR-1 or IFF but has not filed the matching GSTR-3B by 30 September after the year you availed the credit.
- For ITC availed in FY 2025-26, the supplier's cut-off is Wednesday, 30 September 2026. Chase suppliers before then, not after.
- Reverse in a GSTR-3B furnished on or before 30 November 2026. For monthly filers that means October's return. For QRMP filers it means the July–September quarterly return.
- Report the reversal in Table 4(B)(2). Re-avail in 4(A)(5) and 4(D)(1) once the supplier files. Rule 37(4) keeps Section 16(4) from blocking re-availment.
- If the credit is not reversed by 30 November, the amount is payable with interest under Section 50.
- Filing is the only test in Rule 37A. A supplier who filed but under-reported leaves your credit exposed under Section 16(2)(c), which the Gujarat High Court upheld in Maruti Enterprise.
Frequently Asked Questions
What is the Rule 37A deadline for FY 2025-26?
If your supplier has not filed GSTR-3B by 30 September 2026 for the periods behind credit you availed in FY 2025-26, you must reverse that credit in a GSTR-3B you file on or before 30 November 2026. After that, the amount is payable with interest under Section 50.
Does Rule 37A go by the invoice date or the date I claimed ITC?
By the financial year in which you availed the credit. A March 2025 invoice claimed in your April 2025 GSTR-3B falls in the FY 2025-26 cycle, with the 30 September 2026 cut-off.
Can I re-avail ITC reversed under Rule 37A?
Yes. Once the supplier files the pending GSTR-3B, the second proviso to Rule 37A lets you re-avail it in a later GSTR-3B. Rule 37(4) says the Section 16(4) time limit does not apply to re-availing credit reversed earlier.
Where do I report a Rule 37A reversal in GSTR-3B?
In Table 4(B)(2), as GSTN's advisory dated 14 November 2023 directed, consistent with Circular No. 170/02/2022-GST dated 6 July 2022. Re-availed credit goes in Table 4(A)(5) and is also shown in Table 4(D)(1).
Will the GST portal tell me how much to reverse under Rule 37A?
The ITC Reversal tab in GSTR-2B lists documents flagged under Rule 37A. That figure comes from your GSTR-2B, while the rule applies to credit you actually availed, so check it against your books before you file.
Disclaimer: This article is for informational purposes only and does not constitute professional tax advice. GST rules are subject to frequent changes through notifications and circulars. Please consult a qualified tax professional or verify the current provisions on the official GST portal (gst.gov.in) before making any compliance decisions.
Have a specific question about Rule 37A reversals? Our GST experts can help → gstconsultancy.com