🔹 Introduction
The Finance Bill, 2026 proposes targeted amendments to the CGST Act, 2017 and the IGST Act, 2017 through Clauses 137 to 141. These changes focus on rationalising provisions relating to post-supply discounts, credit notes, refund mechanisms, appellate structure for advance rulings, and place of supply of intermediary services.
Unless notified otherwise, these amendments will come into force from a date to be notified, concurrently with corresponding amendments in State GST Acts and Union Territory GST Acts.
This article presents a clean, clause-wise comparison of the law before and after Finance Bill, 2026, to help taxpayers and professionals clearly understand the statutory changes.
🧾 Master Comparative Table – Clauses 137 to 141 (At a Glance)
| Clause | Act | Section | Subject Matter | Core Change Introduced |
|---|
| 137 | CGST | Section 15(3) | Post-supply discounts | Removal of agreement-based condition; discount allowed through credit note linked to Section 34 |
| 138 | CGST | Section 34(1) | Credit Notes | Explicit inclusion of post-supply discount under Section 15(3)(b) |
| 139 | CGST | Section 54(6) & 54(14) | Refunds | Provisional refund extended to inverted ITC; ₹1,000 threshold relaxed for export with payment of tax |
| 140 | CGST | Section 101A(1A) | Advance Ruling Appeals | Transitional mechanism till National Appellate Authority is constituted |
| 141 | IGST | Section 13(8) | Place of Supply | Removal of intermediary services from supplier-location rule |
📌 Clause-wise Detailed Comparison
🔹 Clause 137 – Amendment to Section 15(3), CGST Act (Value of Supply – Discounts)
| Particulars | Before Finance Act, 2026 | After Finance Act, 2026 |
|---|
| Discount before / at time of supply | Allowed if recorded in invoice | No change |
| Post-supply discount | Allowed only if pre-supply agreement existed and linked to invoices | Allowed only through credit note |
| Agreement requirement | Mandatory | ❌ Removed |
| Linkage to Section 34 | Not explicit | Explicitly linked |
| ITC reversal by recipient | Required | Continues |
🔹 Clause 138 – Amendment to Section 34(1), CGST Act (Credit Notes)
| Particulars | Before Finance Act, 2026 | After Finance Act, 2026 |
|---|
| Excess tax/value | Credit note permitted | No change |
| Goods returned / deficiency | Credit note permitted | No change |
| Post-supply discount | Not expressly covered | Expressly included |
| Statutory reference | Standalone provision | Linked to Section 15(3)(b) |
🔹 Clause 139 – Amendments to Section 54, CGST Act (Refunds)
A. Section 54(6) – Provisional Refund
| Particulars | Before | After |
|---|
| Eligible category | Zero-rated supplies only | Zero-rated supplies and unutilised ITC under Section 54(3)(ii) |
| Provisional refund amount | 90% | No change |
B. Section 54(14) – Minimum Refund Threshold
| Particulars | Before | After |
|---|
| Minimum refund limit | ₹1,000 | ₹1,000 (general rule) |
| Export with payment of tax | No exception | Exception carved out |
| Refund < ₹1,000 for such exports | Not allowed | Allowed |
🔹 Clause 140 – Insertion of Section 101A(1A), CGST Act (National Appellate Authority for Advance Ruling)
| Particulars | Before Finance Act, 2026 | After Finance Act, 2026 |
|---|
| Appeals till constitution of National Appellate Authority | No mechanism | Existing authority may be empowered |
| Government power | Not available | Available on Council recommendation |
| Applicability of Section 101A(2)–(13) | Applicable | Not applicable |
| Meaning of “existing authority” | Not defined | Includes Tribunal |
🔹 Clause 141 – Amendment to Section 13(8), IGST Act (Place of Supply of Services)
| Particulars | Before Finance Act, 2026 | After Finance Act, 2026 |
|---|
| Banking/financial services to account holders | Supplier location | No change |
| Intermediary services | Supplier location | ❌ Removed |
| Applicable PoS rule for intermediaries | Section 13(8) | Section 13(2) (general rule) |
🧩 Overall Impact Summary
| Area |
| Impact of Finance Bill, 2026 |
|
|---|
| Discounts |
| Simplified, credit-note driven |
|
| Credit notes |
| Clear statutory linkage |
|
| Refunds |
| Expanded provisional relief |
|
| Advance ruling appeals |
| Transitional certainty |
|
| Intermediary services |
| Alignment with export principles |
|
🏁 Conclusion
The Finance Bill, 2026 brings structural clarity and legal alignment to several long-debated GST provisions. By shifting from agreement-based interpretations to document-driven compliance, expanding refund relief, ensuring continuity in advance ruling appeals, and correcting place-of-supply distortions for intermediary services, the amendments strengthen both ease of compliance and legal certainty.
Taxpayers should review internal processes relating to discounts, refunds, intermediary contracts, and appellate remedies to align with the amended framework once the provisions are notified.
