Chapter X - Payment of tax
Section 49A
Section 49A: Utilisation of input tax credit subject to certain conditions
Section 49A requires available IGST credit to be used fully before CGST, SGST or UTGST credit is applied toward permitted output taxes.
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Need advice on Section 49A?
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
Notwithstanding anything contained in section 49, the input tax credit on account of central tax, State tax or Union territory tax shall be utilised towards payment of integrated tax, central tax, State tax or Union territory tax, as the case may be, only after the input tax credit available on account of integrated tax has first been utilised fully towards such payment.
Introduction
Section 49A overlays the general credit-use rules in section 49. Its sequencing rule matters whenever more than one tax-head credit balance exists.
Key takeaways
First use IGST credit
Before using central, State or Union territory tax credit toward the taxes named in the section, use the available integrated-tax credit fully for the payment.
Then apply other credit
After IGST credit is exhausted, apply remaining credit under sections 49 and 49B and current prescribed ordering.
Keep tax-head separation
The sequence does not repeal the prohibition on using CGST credit for SGST/UTGST or vice versa.
First use IGST credit
Before using central, State or Union territory tax credit toward the taxes named in the section, use the available integrated-tax credit fully for the payment.
Then apply other credit
After IGST credit is exhausted, apply remaining credit under sections 49 and 49B and current prescribed ordering.
Keep tax-head separation
The sequence does not repeal the prohibition on using CGST credit for SGST/UTGST or vice versa.
Practical checklist
Do
- Read all four electronic credit balances before offsetting.
- Exhaust applicable IGST credit first.
- Check the prescribed order under section 49B for remaining credits.
Avoid
- Treat a statutory rate ceiling as the notified live rate.
Frequently asked questions
Can CGST credit be used before available IGST credit?
Section 49A generally requires the available IGST credit to be used fully first for the relevant payment.
Need help applying this provision to your situation?
Contact BizeneedLast updated 10 October 2026