The claimant carries the proof burden
Section 155 of the CGST Act places the burden of proving input-tax-credit eligibility on the person claiming it. It does not replace the substantive eligibility rules or make one document conclusive. This guide, checked on 26 October 2026, addresses the professional evidence file: combine the applicable period’s section 16 conditions, section 17 restrictions and relevant rules with transaction-specific facts. It does not resolve a particular disputed supplier case or promise a judicial outcome. ICAI statutory compilation: CGST Act sections 16, 17 and 155.
Map evidence to each statutory condition
The section 16 framework includes the prescribed tax document, communicated supplier particulars, receipt, the stated restriction/payment conditions and return filing. Business use, blocked credits, applicable time limits and later reversal requirements also need review. Establish the actual period and special provisions before applying a checklist. An invoice plus a matching statement may support some conditions without proving every other condition.
Goods and services need different receipt evidence
For goods, connect purchase order, invoice, delivery/custody records and stock or production use where relevant. For services, retain the engagement, deliverables, acceptance, personnel/time records or other evidence suited to the service. A universal goods-received note is not the only possible service evidence. Section 16’s deemed-receipt explanation also requires attention: physical delivery to the claimant’s own warehouse is not the sole permitted pattern.
Distinguish lack of evidence from an established legal failure
A missing document can be an unresolved gap; it is not always proof that supply never occurred. Conversely, a complete-looking invoice is not proof that it did. Record what is established, what remains to be obtained and which legal condition is affected. Resolve authenticity concerns and inconsistent dates through actual records rather than manufacturing retrospective delivery evidence or substituting a generic vendor declaration for every fact.
Quantify exposure without counting the same credit twice
Link each invoice to its claimed tax amount, period and ledger entry. Where the same invoice has several evidence issues, maintain one unique credit amount with multiple reasons. Separate potentially remediable documentary gaps from established blocked or otherwise ineligible credit. An evidence-completion percentage is a management statistic, not a statutory permission to claim the remainder or an estimate of litigation success.
Retain the decision and later changes
Document the supported claim, reversals or other appropriate action under the actual applicable provisions, subsequent evidence and any valid re-availment basis. Filing a return is not proof that every substantive condition was met; keeping an internal hold list is not itself a statutory reversal. The examples assume the tax figures and stated eligibility conclusions are independently established and calculate credit/evidence reconciliations, not GST rates, interest or penalties.
Applicable primary references
ICAI statutory compilation: CGST Act sections 16, 17 and 155
Six worked illustrations
All facts and amounts below are fictional. Assumptions describe the model, not additional statutory rules.
Illustrative example 1: Invoice-wise supported and unresolved amounts
A review covers ₹1,00,000 of claimed ITC. ₹75,000 has complete supporting facts on the assumed conditions; ₹25,000 has unresolved receipt evidence. Track the ₹25,000 gap separately. The 75% supported amount does not establish an acceptable statutory gap percentage or automatically settle the unresolved claim.
Illustrative example 2: Remove a repeated claim
One genuine invoice carrying ₹18,000 ITC is included twice in a claim list, creating ₹36,000. The duplicate is ₹18,000. Retain one claim only if its substantive conditions are met; a genuine document does not authorise two credits.
Illustrative example 3: Overlapping evidence gaps
An invoice set has ₹40,000 ITC with missing receipt support and ₹30,000 with business-use questions; ₹10,000 appears in both groups. Unique credit under review is ₹60,000, not ₹70,000. Preserve both grounds against the overlapping ₹10,000.
Illustrative example 4: Separate an established blocked amount
Of an assumed ₹50,000 credit pool, ₹12,000 is independently established as blocked under the applicable facts and law, with no exception, and ₹38,000 otherwise satisfies all conditions. The supported eligible amount is ₹38,000. The conclusion about ₹12,000 must come from its actual legal category, not this arithmetic alone.
Illustrative example 5: Service-evidence coverage
Twenty-five service invoices are reviewed; twenty have suitable completed-delivery/acceptance support and five do not yet. Evidence coverage is 80%, with a 20% gap by invoice count. This says nothing about the rupee-weighted exposure until the five invoices are separately valued.
Illustrative example 6: Do not confuse count and value
Those five unresolved invoices carry ₹2,000, ₹3,000, ₹4,000, ₹5,000 and ₹6,000 ITC, totalling ₹20,000. If the full twenty-five-invoice pool is ₹2,00,000, unresolved value is 10%, although unresolved invoice count was 20%. Neither statistic substitutes for transaction-wise legal review.
Ten-step verification table
| Step | Action | Evidence |
|---|---|---|
| 1 | Identify the claim and period | GSTIN, return period and actual applicable law. |
| 2 | List unique invoices and tax amounts | Document IDs and claimed credit references. |
| 3 | Verify prescribed documents | Actual invoice/debit note and authenticity checks. |
| 4 | Reconcile communicated particulars | Relevant statements and specific discrepancies. |
| 5 | Establish receipt or deemed receipt | Goods movement or service evidence fitting the facts. |
| 6 | Support business use | Purpose, contract, operational use and restrictions. |
| 7 | Review all other eligibility conditions | Applicable section 16/17 and rule requirements. |
| 8 | Separate supported and unresolved amounts | Condition-wise conclusions without duplicate exposure. |
| 9 | Document actual compliance action | Claim, reversal or other treatment under relevant law. |
| 10 | Preserve later evidence and decisions | Versioned file, acknowledgements and valid follow-up. |
Sixteen practitioner FAQs
1. Who bears the section 155 proof burden?
The person claiming eligibility for ITC.
2. Does section 155 itself list every eligibility condition?
No. Apply the substantive Act and rules as relevant.
3. Is possession of an invoice alone conclusive?
No. Other conditions and facts require evidence.
4. Does matching supplier data alone prove the entire claim?
No. It may support particular conditions without proving receipt or every restriction.
5. Must goods always physically enter the claimant’s warehouse?
Consider the statutory deemed-receipt situations rather than assuming that universal requirement.
6. Is one standard receipt document appropriate for every service?
No. Evidence should fit the actual service and delivery/acceptance facts.
7. Does a missing record automatically prove non-supply?
Not necessarily. Investigate and classify the unresolved fact accurately.
8. Does a vendor declaration automatically cure every gap?
No. Test what it actually proves and what remains unsupported.
9. Can several grounds relate to one invoice?
Yes. Preserve all grounds while counting the credit only once.
10. Does an evidence gap always equal an established blocked credit?
No. Separate unresolved proof from concluded statutory ineligibility.
11. Can a genuine invoice support duplicate credits?
No.
12. Are completion percentages regulatory tolerance limits?
No. They are review metrics only.
13. Can invoice-count exposure differ from value exposure?
Yes. Compute both from the actual population where useful.
14. Does filing the return establish substantive eligibility?
No.
15. Does an internal hold spreadsheet itself effect a reversal?
No. Complete the action required under the applicable legal process.
16. What is the core deliverable?
An invoice-wise file linking each condition, actual evidence, tax amount, conclusion and later valid action.
Conclusion
Build an invoice-wise ITC evidence file that tests receipt, business use and other applicable conditions; a matching statement alone does not establish the complete claim.
Sources and primary references
India Code: CGST Act, sections 16, 17 and 155; CBIC Circular 241/35/2024-GST, dated 31 December 2024: receipt under section 16(2)(b), including EXW delivery.