Text
The text below is the rule as served by the CBIC tax information portal on 17 September 2026, with the portal's own amendment footnote markers (shown as small numerals before a bracket) and its footnotes.[1] The Rules as published in the Gazette of India is the legal source.
Rule 86, verbatim (show)
Rule 86
Rule 86. Electronic Credit Ledger.-
(1) The electronic credit ledger shall be maintained in FORM GST PMT-02 for each registered person eligible for input tax credit under the Act on the common portal and every claim of input tax credit under the Act shall be credited to the said ledger.
(2) The electronic credit ledger shall be debited to the extent of discharge of any liability in accordance with the provisions of section 49 1[or section 49A or section 49B].
(3) Where a registered person has claimed refund of any unutilized amount from the electronic credit ledger in accordance with the provisions of section 54, the amount to the extent of the claim shall be debited in the said ledger.
(4) If the refund so filed is rejected, either fully or partly, the amount debited under sub rule (3), to the extent of rejection, shall be re-credited to the electronic credit ledger by the proper officer by an order made in FORM GST PMT-03.
2[(4A) Where a registered person has claimed refund of any amount paid as tax wrongly paid or paid in excess for which debit has been made from the electronic credit ledger, the said amount, if found admissible, shall be re-credited to the electronic credit ledger by the proper officer by an order made in FORM GST PMT-03.]
3[(4B) Where a registered person deposits the amount of erroneous refund sanctioned to him, -
(a) under sub-section (3) of section 54 of the Act, or (b) under sub-rule (3) of rule 96, 4[****], along with interest and penalty, wherever applicable, through FORM GST DRC-03, by debiting the electronic cash ledger, on his own or on being pointed out, an amount equivalent to the amount of erroneous refund deposited by the registered person shall be re-credited to the electronic credit ledger by the proper officer by an order made in FORM GST PMT-03A.]
(5) Save as provided in the provisions of this Chapter, no entry shall be made directly in the electronic credit ledger under any circumstance.
(6) A registered person shall, upon noticing any discrepancy in his electronic credit ledger, communicate the same to the officer exercising jurisdiction in the matter, through the common portal in FORM GST PMT-04.
Explanation. - For the purposes of this rule, it is hereby clarified that a refund shall be deemed to be rejected, if the appeal is finally rejected or if the claimant gives an undertaking to the proper officer that he shall not file an appeal.
1 .Inserted (w.e.f. 01.02.2019) vide Notification No. 03/2019-CT dated 29.01.2019.
2. Inserted vide Notification No. 16/2020-CT dated 23.03.2020.
3. Inserted videNotification No. 14/2022-CT dated 05.07.2022.
4. Omitted "in contravention of sub-rule (10) of rule 96" vide Notification No. 20/2024-CT dated 08.10.2024.
86(1)Credit-ledger maintenance
every claim of input tax credit under the Act shall be credited to the said ledgerRule 86(1)
PMT-02 is maintained through the common portal for each eligible registered person. Ledger posting is distinct from the underlying statutory credit requirements.
Questions to answer on the file6 questions
86(2)Liability debit
debited to the extent of discharge of any liabilityRule 86(2)
Debit follows the amount discharged in accordance with sections 49, 49A or 49B. The ledger mechanism therefore depends on the applicable utilisation provisions.
Questions to answer on the file4 questions
86(3)Refund-claim debit
the amount to the extent of the claim shall be debitedRule 86(3)
A section 54 claim for unutilised credit requires a corresponding ledger debit. The claim amount sets the extent of that debit.
Questions to answer on the file6 questions
86(4); ExplanationRejected-refund re-credit
the amount debited under sub rule (3), to the extent of rejectionRule 86(4); Explanation
The proper officer orders PMT-03 re-credit to the rejected extent. The explanation treats rejection as final appeal rejection or an undertaking by the claimant not to appeal.
Questions to answer on the file8 questions
86(4A)Wrong or excess tax
the said amount, if found admissible, shall be re-creditedRule 86(4A)
The original payment must have debited the credit ledger. An admissible claim for wrong or excess tax follows a proper officer’s PMT-03 re-credit order.
Questions to answer on the file10 questions
86(4B)Erroneous-refund repayment
an amount equivalent to the amount of erroneous refund depositedRule 86(4B)
The route covers the specified section 54(3) or Rule 96(3) erroneous refunds. Repayment uses a cash-ledger debit through DRC-03, with interest and penalty wherever applicable, voluntarily or when pointed out. The proper officer orders equivalent principal re-credit in PMT-03A.
Questions to answer on the file14 questions
86(5)Direct-entry restriction
no entry shall be made directly in the electronic credit ledger under any circumstanceRule 86(5)
The Chapter’s express provisions qualify the direct-entry restriction. An unsupported direct entry does not follow that mechanism.
Questions to answer on the file3 questions
86(6)Discrepancy communication
communicate the same to the officer exercising jurisdiction in the matterRule 86(6)
A registered person who notices a discrepancy must use PMT-04 through the common portal. The communication goes to the officer with jurisdiction over the matter.
Questions to answer on the file7 questions
Frequently asked questions
Do all re-credit routes use the same form?
Rejected-refund and admissible wrong-or-excess-tax routes use PMT-03. The specified erroneous-refund repayment route uses PMT-03A.
Rule 86(4)-(4B)
Does erroneous-refund repayment use the credit ledger?
Sub-rule (4B) requires repayment through DRC-03 by debiting the cash ledger, with applicable interest and penalty. The proper officer separately orders the specified credit-ledger re-credit.
Rule 86(4B)
How is a ledger discrepancy reported?
The registered person communicates it to the jurisdictional officer through the common portal in PMT-04.
Rule 86(6)
Amendment history
The CBIC text carries 3 footnotes. The table gives each in the source's own terms. Effective dates are as the footnotes state them.[1]
| Note | Change |
|---|---|
| 2 | Inserted vide Notification No. 16/2020-CT dated 23.03.2020.[2] |
| 3 | Inserted videNotification No. 14/2022-CT dated 05.07.2022.[3] |
| 4 | Omitted "in contravention of sub-rule (10) of rule 96" vide Notification No. 20/2024-CT dated 08.10.2024.[4] |
Relationship with other provisions
| Provision | Connection | Words that tie them |
|---|---|---|
| Section 49 of the CGST Act, 2017 | this provision requires Section 49 of the CGST Act, 2017 | 86(2) "section 49" |
| Section 49A of the CGST Act, 2017 | this provision requires Section 49A of the CGST Act, 2017 | 86(2) "section 49A" |
| Section 49B of the CGST Act, 2017 | this provision requires Section 49B of the CGST Act, 2017 | 86(2) "section 49B" |
| Section 54 of the CGST Act, 2017 | this provision requires Section 54 of the CGST Act, 2017 | 86(3) "section 54" |
| Rule 96 | this provision requires Rule 96 | 86(4B) "sub-rule (3) of rule 96" |
Circulars and notifications
Circulars and notifications in the CBIC repository that cite this rule, newest first, by number, date and subject. A listing here does not say what an instrument decides; read the instrument.
Circulars (5)
| Number | Date | Subject |
|---|---|---|
| Circular No. 172/04/2022-GST | 6 July 2022 | Clarification on various issue pertaining to GST |
| Circular No. 174/06/2022-GST | 6 July 2022 | Prescribing manner of re-credit in electronic credit ledger using FORM GST PMT-03A. |
| Circular No. 135/05/2020-GST | 31 March 2020 | Circular on Clarification on refund related issues - Reg |
| Circular No. 17/17/2017-GST | 15 November 2017 | Manual filing and processing of refund claims in respect of zero-rated supplies. Rescinded vide Circular No. 125/44/2019 - GST dated 18.11.2019. rescinded by a later instrument |
| Circular No. 3/03/2017-GST | 5 July 2017 | Proper officer relating to provisions other than Registration and Composition under the Central Goods and Services Tax Act, 2017-Reg. |
Notifications (6)
| Number | Date | Subject |
|---|---|---|
| Notification No. 20/2024-Central Tax | 8 October 2024 | Seeks to make amendments (Second Amendment 2024) to the CGST Rules, 2017 |
| Notification No. 14/2022-Central Tax | 5 July 2022 | Seeks to make amendments (First Amendment, 2022) to the CGST Rules, 2017 |
| Notification No. 16/2020-Central Tax | 23 March 2020 | Seeks to make third amendment (2020) to CGST Rules. |
| Notification No. 75/2019-Central Tax | 26 December 2019 | Seeks to carry out changes in the CGST Rules, 2017. |
| Notification No. 03/2019-Central Tax | 29 January 2019 | Seeks to amend the CGST Rules, 2017. |
| Notification No. 10/2017-Central Tax | 28 June 2017 | Seeks to amend CGST Rules notification no 3/2017-Central Tax dt 19.06.2017 amended by a later instrument |
Unsettled questions
The words of Rule 86 do not answer this question. Where one decides a matter on the file, the answer depends on the position taken on it.
- No additional silent question identified; unresolved evidence remains open and legal classification is reserved to the auditor where specified
See also
- Section 49 of the CGST Act, 2017: payment of tax, interest, penalty and other amounts
- Section 49A of the CGST Act, 2017: utilisation of input tax credit subject to certain conditions
- Section 49B of the CGST Act, 2017: order of utilisation of input tax credit
- Section 54 of the CGST Act, 2017: refund of tax
- Rule 96 of the CGST Rules, 2017: refund of integrated tax paid on goods or services 220exported out of India
References
- Central Board of Indirect Taxes and Customs. "Rule 86. Electronic Credit Ledger". Central Goods and Services Tax Rules, 2017, CBIC tax information portal, with amendment footnotes 1 to 3. Retrieved 17 September 2026.
- Notification No. 16/2020-Central Tax, dated 23 March 2020: Seeks to make third amendment (2020) to CGST Rules. Cited in CBIC footnote 2.
- Notification No. 14/2022-Central Tax, dated 5 July 2022: Seeks to make amendments (First Amendment, 2022) to the CGST Rules, 2017. Cited in CBIC footnote 3.
- Notification No. 20/2024-Central Tax, dated 8 October 2024: Seeks to make amendments (Second Amendment 2024) to the CGST Rules, 2017. Cited in CBIC footnote 4.
External links
- CGST Rules, 2017, Rule 86 on the CBIC tax information portal