https://www.taxtmi.com/highlights?id=105827 Section 16(2)(c) requires actual payment of tax to the Government and is not limited to fraud or collusion, but supplier default alone does not justify mechanical reversal of a recipient's input tax credit. Eligibility requires scrutiny of transaction evidence, the nature of the default, supplier recovery proceedings and the law applicable to the tax period. Supplier cancellation or fraud does not automatically establish recipient ineligibility or complicity. The recipient bears the burden of proving eligibility, while fraud allegations require supporting facts in the notice. Section 41 permits re-availment after supplier payment, and Rule 37A provides a reversal and re-availment mechanism for specified return defaults. Later conditions and mechanisms must not be applied to earlier periods. en-us Wed, 04 Nov 2026 10:21:06 +0530 Wed, 04 Nov 2026 10:21:06 +0530 TaxTMI RSS Generator https://www.taxtmi.com/highlights?id=105827 Section 16(2)(c) requires actual payment of tax to the Government and is not limited to fraud or collusion, but supplier default alone does not justify mechanical reversal of a recipient's input tax credit. Eligibility requires scrutiny of transaction evidence, the nature of the default, supplier recovery proceedings and the law applicable to the tax period. Supplier cancellation or fraud does not automatically establish recipient ineligibility or complicity. The recipient bears the burden of proving eligibility, while fraud allegations require supporting facts in the notice. Section 41 permits re-availment after supplier payment, and Rule 37A provides a reversal and re-availment mechanism for specified return defaults. Later conditions and mechanisms must not be applied to earlier periods. Highlights GST Wed, 04 Nov 2026 10:21:06 +0530 https://www.taxtmi.com/highlights?id=105827