Section 42 - Matching, reversal and reclaim of input tax credit.

Input tax credit matching and reversal: unmatched or duplicate claims are added to recipient's output liability and attract interest.

Matching of inward supply details with corresponding outward supplies, integrated tax on imports, and for duplicate claims is mandated; matching invoices are finally accepted. Discrepancies where recipient's credit exceeds supplier's declaration must be communicated to both parties. Unrectified discrepancies and duplication-related excess credits are added to the recipient's output tax liability. Recipients pay interest on such additions from the date of availing credit; if the supplier later corrects returns timely the recipient can reduce the added amount and obtain interest credit in the electronic cash ledger, limited to interest paid by the supplier.