GST in 2026: A Complete Section-by-Section Guide for Pune Businesses

The integrated GST handbook for AY 2026-27

GST law is sometimes painted as endless and complex. In practice it sits on a small number of foundational sections of the CGST Act, 2017 and IGST Act, 2017 — supply, time and place of supply, registration, input tax credit, returns, audit and recovery. Master these, and the rest is configuration. This guide is the integrated map, with links to the detailed spoke articles on each.

1. What GST is, and what it taxes

GST is a tax on supply of goods and services. Under Section 7 of the CGST Act, "supply" includes all forms of supply of goods or services for a consideration in the course or furtherance of business, with specified import-of-services and Schedule I transactions even without consideration. Activities listed in Schedule III — including the sale of land, the sale of completed buildings, services by an employee to the employer, and certain court services — are neither a supply of goods nor a supply of services, and therefore outside GST.

The dual GST architecture (CGST + SGST for intra-State supplies, IGST for inter-State and import supplies) flows from the place-of-supply rules under Sections 10–13 of the IGST Act.

2. Registration — who needs to be in the system

Three sections of the CGST Act decide registration: Section 22 (turnover-based threshold), Section 23 (exempt persons), Section 24 (compulsory registration regardless of turnover). For Pune businesses, the headline thresholds are ₹40 lakh for goods suppliers and ₹20 lakh for service suppliers, with compulsory registration triggered for inter-State suppliers of goods, casual taxable persons, NRTs, e-commerce sellers and several other categories.

The Section 10 composition scheme — 1% for traders and manufacturers, 5% for restaurants, 6% under Section 10(2A) for service providers up to ₹50 lakh — is the simpler alternative for small taxpayers.

The complete walkthrough, with the Rule 8 PAN-plus-Aadhaar application process, the special-category-state list and the Section 122 penalty for late registration, is in our GST Registration Guide 2026.

3. Input tax credit — the cash-flow workhorse

Section 16 of the CGST Act sets four eligibility conditions for ITC: the recipient must possess a tax invoice, the goods/services must have been received, the supplier must have paid the tax to the Government and filed the corresponding return (Section 16(2)(aa)), and the recipient must have filed their own return.

Section 17 apportions credit between business and non-business use, between taxable and exempt supplies (Rules 42 and 43), and lists the blocked credits in Section 17(5) — including the construction of immovable property for own use that drives the real-estate ITC chain (see our GST on Real Estate guide).

Common errors in claiming ITC — and the fix — are covered in our Common GST Mistakes 2026.

4. Time and place of supply — when and where

Time of supply under Sections 12–14 of the CGST Act decides which return period the tax falls into. For goods (Section 12), it is the earlier of invoice and payment; for services (Section 13), the earlier of invoice (if issued in time under Section 31) or completion of service, and payment. Rate-change rules in Section 14 govern transitional pricing.

Place of supply under IGST Sections 10–13 decides whether the tax is CGST+SGST or IGST. For services, Section 12 (both parties in India) and Section 13 (one party outside India) are where most cross-border issues land.

5. Returns and the monthly close

The core returns:

• GSTR-1 — outward supplies, by the 11th of the following month (quarterly under QRMP for taxpayers up to ₹5 crore).
• GSTR-3B — summary return and tax payment, by the 20th of the following month (with staggered dates under QRMP).
• GSTR-2B — auto-generated ITC statement available by the 14th, used to validate Section 16(2)(aa) ITC.
• GSTR-9 — annual return, by 31 December of the following financial year (turnover ≤ ₹2 crore is exempt).
• GSTR-9C — reconciliation statement, required where turnover exceeds the prescribed limit (currently ₹5 crore).
• e-invoicing mandatory for taxpayers with turnover above the notified threshold (currently ₹5 crore aggregate).

6. Refunds

Section 54 of the CGST Act governs refunds — of accumulated ITC on zero-rated supplies (exports / SEZ), of tax paid on inverted duty structures, of tax wrongly charged (with Section 77 / IGST Section 19 mechanics), and of refunds under deemed-export schemes. Applications are filed in Form GST RFD-01 with the prescribed annexures within two years from the relevant date.

7. Notices, scrutiny and audit

The compliance pipeline runs as follows:

• Section 61 — scrutiny of returns: notice in Form ASMT-10, 30-day reply in ASMT-11, closure in ASMT-12. See our ASMT-10 reply guide.
• Sections 62, 63, 64 — best-judgment and summary assessments for non-filers, unregistered persons and revenue-at-risk cases. See GST Assessment vs Audit.
• Section 65 — departmental audit, ADT-01 notice, 3-month (+6-month extension) period.
• Section 66 — special audit by CA/CMA, ADT-03 direction, 90-day report.
• Sections 73 and 74 — recovery proceedings: 73 for ordinary cases (3-year window, 10% penalty), 74 for fraud/wilful misstatement (5-year window, 100% penalty); both with Section 73(5) / 74(5) safe harbour for pre-SCN payment.

8. Real estate — its own scheme

Real estate is the most over-engineered GST chapter, with a dedicated post-2019 scheme of 1% / 5% without ITC for residential housing under Notification 03/2019-CT (Rate), 18% with ITC for commercial works contract, and Schedule III Para 5(b) excluding completed buildings from GST altogether. Joint development agreements have their own TDR / FSI mechanics under Notification 04/2019 / 05/2019. The full chapter is in our GST on Real Estate Transactions 2026.

9. Sector-specific notes

A few of the higher-volume sector-specific positions Pune businesses bump into:

• Restaurants — 5% without ITC if not in a hotel charging room tariff above the notified rate; 18% with ITC otherwise.
• GTA (Goods Transport Agency) — 5% without ITC or 12% with ITC (Forward Charge option), with RCM on the recipient where the GTA opts for 5%.
• Legal services by individual advocates — RCM on the recipient.
• Security services from non-corporate suppliers — RCM on a body-corporate recipient.
• Renting of immovable property for residential use — RCM on a GST-registered tenant since 18-Jul-2022.
• Online information and database access (OIDAR) — compulsory registration under Section 24 for foreign suppliers serving Indian consumers.

10. Compliance discipline — what good looks like

For a Pune business doing well on GST, the monthly close looks like:

1. GSTR-1 prepared mid-month from invoices issued, with HSN/SAC mapped to the master list.
2. 2B reviewed by the 15th; missing-supplier invoices chased; ITC limited to what is in 2B.
3. 3B reconciled with GSTR-1 (output) and 2B (input); RCM cash component prepared.
4. Cash payment through the electronic cash ledger; ITC claimed against eligible 2B credits.
5. 3B filed by the 20th.
6. EWB reconciled with GSTR-1 weekly.

Done well, this keeps you firmly in Section 59 self-assessment territory, with the other five assessment routes never reaching your desk.

File your GST with RDA, Pune

We run the monthly close end-to-end for Pune businesses across sectors — manufacturers in Bhosari and Chakan, traders in Camp and Market Yard, professionals in Baner and Aundh, IT and e-commerce in Hinjewadi and Kharadi. We reconcile every line, discharge RCM in cash, claim ITC only where 2B supports it, and respond to scrutiny notices the same week. Book a GST consultation at rdatax.in or call +91 77570 45059 — RDA Tax Advisory Services, Office No. 102, Snehraj Apartment, Baner, Pune 411045.

Verification note: Material legal positions in this pillar — CGST Act Sections 7 (supply), 9 (levy and RCM), 12-14 (time of supply), 16-17 (ITC), 22-24 (registration), 31 (invoicing), 35 (records), 37/39 (returns), 49-50 (payment and interest), 54 (refunds), 61 (scrutiny), 62-64 (best-judgment / summary assessment), 65-66 (audit), 73-74 (recovery), 77 (refund of wrong tax type), 122 (penalty for late registration); CGST Rules Rules 42-43 (apportionment), 86A-86B (electronic credit ledger restrictions), 99 (scrutiny), 101-102 (audit), Rule 8 (registration); IGST Act Sections 7 (inter-State supply), 10-13 (place of supply), 19 (refund of wrongly-charged tax); Schedule III CGST Act; Notifications 03/2019, 04/2019, 05/2019, 11/2017, 03/2022, 05/2022 (all Central Tax Rate); CBIC Instruction 02/2022-GST; CBIC Circular 183/15/2022-GST — are sourced from the CBIC Tax Information Portal and the CBIC GST portal.