57th GST Council: arrest powers, prosecution limits, refunds and input tax credit

The meeting

The 57th meeting of the GST Council was held in New Delhi on 8 October 2026, chaired by the Union Finance Minister. Unlike the 56th meeting in 2025, which rationalised rates, this meeting dealt mainly with registration, returns, refunds, enforcement and litigation. No change to the overall rate structure was recommended.

Key recommendations

• Arrests: withdrawal of the power of arrest under section 69 of the CGST Act.
• Prosecution: the monetary threshold for prosecution to be raised to ₹5 crore.
• Refunds: largely automated refunds, and a wider refund of accumulated input tax credit, including credit on input services in inverted duty structure cases.
• Input tax credit: removal of the block on credit for certain items, including insurance, telecom towers, pipelines and free samples.
• Exports: changes to remove some long-standing barriers faced by exporters of services.

When do they apply?

A Council recommendation does not change the law by itself. It takes effect only when the government issues notifications or circulars, or amends the GST Acts. Reports indicate that many of the changes are expected to apply from 1 April 2027.

Some measures have already been notified. CBIC rate notifications dated 27 and 28 October 2026 apply from 1 November 2026, and CBIC has issued instructions on arrests and on a minimum amount for issuing notices. Check the exact notification before relying on any change.

What to do

Review where your business is affected: blocked credits, refund claims and pending litigation. Do not change invoicing or credit claims until the relevant notification is in force.

This update reflects the position as on 7 November 2026 and is for general information only. It is not professional advice. Please refer to the official notification or circular, or speak to us, before acting on it.