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Rule 2 of the GST Settlement of Funds Rules, 2017

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GST›GST Settlement of Funds Rules, 2017

Rule 2 defines the authorities, credit movements, registrations and reports used for settlement, unless the context otherwise requires. Cross utilisation links integrated-tax credit with other GST heads in the stated directions under the applicable provisions. State accounting and taxation authorities require notification by the concerned State Government, while registered person excludes a Unique Identity Number holder.[1]

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 2, verbatim (show)

Rule 2

Rule 2. Definitions.-

In these rules, unless the context otherwise requires, -

(1) (a) “Authorities” means the Board, State Tax Nodal Authority, Principal Chief Controller of Accounts, Central Board of Indirect Taxes and Customs and State Accounting Authorities of the respective States;

(b) “Board” means the Central Board of Indirect Taxes and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963);

(c) “cross utilisation of credit” means utilisation of-

(i) credit on account of Integrated Tax for payment of Central Tax or State Tax or Union Territory Tax; or

(ii) credit on account of Central Tax or State Tax or Union Territory Tax for payment of Integrated Tax, in accordance with the provisions of sections 49 or 49A or 49B of the Central Goods and Services Tax Act, 2017 read with the provisions of sections 49 or 49A or 49B of the concerned State Goods and Services Tax Act, 2017 or section 9 or 9A or 9B of the Union Territory Goods and Services Tax Act, 2017 (14 of 2017) or section 18 of the Integrated Goods and Services Tax Act, 2017, as the case may be;

(d) “Government” means the Central Government;

(e) “input tax credit” means the credit of input tax;

(f) “registered person” means a person who is registered under section 25 of the Central Goods and Services Tax Act, 2017, but does not include a person having a Unique Identity Number;

(g) “reports” means any report specified or otherwise required to be furnished by or under these rules;

(h) “State Accounting Authority” means Accounting Authority of any State notified as such by the concerned State Government;

(i) “State Tax Nodal Authority” means the Taxation Authority of any State notified as such by the concerned State Government.

(2) The words and expressions used and not defined in these rules, but defined in the Central Goods and Services Tax Act, 2017, the concerned State Goods and Services Tax Act, 2017, the Integrated Goods and Services Tax Act, 2017 and the Union Territories of Goods and Services Tax Act, 2017 or in the rules made under any of the said Acts or the aforesaid rules as the case may be.

2(1)(a)Authorities

“Authorities” means the Board, State Tax Nodal Authority, Principal Chief Controller of Accounts, Central Board of Indirect Taxes and Customs and State Accounting Authorities of the respective States;Rule 2(1)(a)

The term groups the Board, State Tax Nodal Authority, Principal Chief Controller of Accounts of the Central Board of Indirect Taxes and Customs, and the respective State Accounting Authorities.

Questions to answer on the fileAuthorities: Board2 questions
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Questions to answer on the fileAuthorities: State Tax Nodal Authority2 questions
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Questions to answer on the fileAuthorities: Principal Chief Controller of Accounts, Central Board of Indirect Taxes and Customs2 questions
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Questions to answer on the fileAuthorities: State Accounting Authorities2 questions
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2(1)(b)Board

“Board” means the Central Board of Indirect Taxes and Customs constituted under the Central Boards of Revenue Act, 1963 (54 of 1963);Rule 2(1)(b)

The term identifies the Central Board of Indirect Taxes and Customs constituted under the Central Boards of Revenue Act, 1963.

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2(1)(c)cross utilisation of credit

“cross utilisation of credit” means utilisation of- (i) credit on account of Integrated Tax for payment of Central Tax or State Tax or Union Territory Tax; or (ii) credit on account of Central Tax or State Tax or Union Territory Tax for payment of Integrated Tax, in accordance with the provisions of sections 49 or 49A or 49B of the Central Goods and Services Tax Act, 2017 read with the provisions of sections 49 or 49A or 49B of the concerned State Goods and Services Tax Act, 2017 or section 9 or 9A or 9B of the Union Territory Goods and Services Tax Act, 2017 (14 of 2017) or section 18 of the Integrated Goods and Services Tax Act, 2017, as the case may be;Rule 2(1)(c)

The definition covers integrated-tax credit used for central, State or Union territory tax, and credit of those taxes used for integrated tax. The utilisation must comply with the applicable provisions identified in the clause.

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2(1)(d)Government

“Government” means the Central Government;Rule 2(1)(d)

The term means the Central Government.

Questions to answer on the file2 questions
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2(1)(e)input tax credit

“input tax credit” means the credit of input tax;Rule 2(1)(e)

The term means credit of input tax.

Questions to answer on the file2 questions
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2(1)(f)registered person

“registered person” means a person who is registered under section 25 of the Central Goods and Services Tax Act, 2017, but does not include a person having a Unique Identity Number;Rule 2(1)(f)

The person must be registered under CGST section 25. A person holding a Unique Identity Number is excluded.

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2(1)(g)reports

“reports” means any report specified or otherwise required to be furnished by or under these rules;Rule 2(1)(g)

The term covers reports specified or otherwise required to be furnished under these rules.

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2(1)(h)State Accounting Authority

“State Accounting Authority” means Accounting Authority of any State notified as such by the concerned State Government;Rule 2(1)(h)

The concerned State Government must notify the State’s Accounting Authority as such.

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2(1)(i)State Tax Nodal Authority

“State Tax Nodal Authority” means the Taxation Authority of any State notified as such by the concerned State Government.Rule 2(1)(i)

The concerned State Government must notify the State’s Taxation Authority as such.

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Questions to answer on the file

Questions a reviewer answers from the engagement file, grouped by the part of the rule they come from. They describe what the rule asks; they do not decide it.

Uncompleted external-definition sentence 2(2)

Questions to answer on the file4 questions
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Frequently asked questions

When can context require a different meaning?

The law does not settle when context requires a meaning different from these definitions. The opening qualification applies to the terms.

Rule 2(1)

What does sub-rule (2) cover?

Sub-rule (2) deals with words and expressions used but not defined in these rules and defined in the Central, State, Integrated or Union Territories Goods and Services Tax Acts, or in the rules made under them. The CBIC text of the sub-rule stops before saying what meaning they carry.

Rule 2(2)

Circulars and notifications

No circular or notification in the CBIC repository is recorded as citing this rule.

Unsettled questions

The words of Rule 2 do not answer these questions. Where one decides a matter on the file, the answer depends on the position taken on it.

  1. When does the context require another meaning under the identified GST Act or Rules?
  2. When does the context require another meaning under the identified GST Act or Rules?
  3. When does the context require another meaning under the identified GST Act or Rules?
  4. When does the context require another meaning under the identified GST Act or Rules?
  5. When does the context require another meaning under the identified GST Act or Rules?
  6. When does the context require another meaning under the identified GST Act or Rules?
  7. When does the context require another meaning under the identified GST Act or Rules?
  8. When does the context require another meaning under the identified GST Act or Rules?
  9. When does the context require another meaning under the identified GST Act or Rules?
  10. When does the context require another meaning under the identified GST Act or Rules?
  11. When does the context require another meaning under the identified GST Act or Rules?
  12. When does the context require another meaning under the identified GST Act or Rules?
  13. What operative effect, if any, should be given to the incomplete Rule 2(2) sentence, which lists sources without stating that their meanings apply?

References

  1. Central Board of Indirect Taxes and Customs. "Rule 2. Definitions". Goods and Services Tax Settlement of Funds Rules, 2017, CBIC tax information portal. Retrieved 17 September 2026.

External links