Chapter IX - Returns
Section 41
Section 41: Availment of input tax credit
Section 41 allows self-assessed eligible ITC in a return and requires reversal with interest if the supplier has not paid the related tax, with re-availment after supplier payment.
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Need advice on Section 41?
This article is for general information. Refer to the Central Goods and Services Tax Act, 2017 official text for the official provisions. If you need professional advice for your situation, contact Bizeneed.
Statutory text
Bare law
(1) Every registered person shall, subject to such conditions and restrictions as may be prescribed, be entitled to avail the credit of eligible input tax, as self-assessed, in his return and such amount shall be credited to his electronic credit ledger.
(2) The credit of input tax availed by a registered person under sub-section (1) in respect of such supplies of goods or services or both, the tax payable whereon has not been paid by the supplier, shall be reversed along with applicable interest, by the said person in such manner as may be prescribed: Provided that where the said supplier makes payment of the tax payable in respect of the aforesaid supplies, the said registered person may re-avail the amount of credit reversed by him in such manner as may be prescribed.
Introduction
Section 41 explains how eligible self-assessed ITC enters the electronic credit ledger and what happens if the supplier has not paid the tax on the relevant supply.
Key takeaways
Self-assessed availment
Subject to prescribed conditions and restrictions, a registered person may avail eligible input-tax credit in the return; the amount is credited to the electronic credit ledger.
Supplier non-payment
Where the supplier has not paid tax payable on the supply, the recipient must reverse the corresponding credit with applicable interest in the prescribed manner.
Re-availment
If the supplier subsequently pays that tax, the recipient may re-avail the reversed credit in the prescribed manner. The recipient should retain a clear invoice-level audit trail.
Self-assessed availment
Subject to prescribed conditions and restrictions, a registered person may avail eligible input-tax credit in the return; the amount is credited to the electronic credit ledger.
Supplier non-payment
Where the supplier has not paid tax payable on the supply, the recipient must reverse the corresponding credit with applicable interest in the prescribed manner.
Re-availment
If the supplier subsequently pays that tax, the recipient may re-avail the reversed credit in the prescribed manner. The recipient should retain a clear invoice-level audit trail.
Practical checklist
Do
- Confirm section 16 eligibility and the section 38 statement.
- Document any supplier-payment issue and calculate the prescribed reversal.
- Track evidence of later supplier payment before re-availing.
Avoid
- Rely on an old portal deadline without checking current Rules and notifications.
Frequently asked questions
Is reversal always permanent?
No. Section 41(2) permits re-availment when the supplier pays the relevant tax, in the prescribed manner.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026