Facts checked on 27 October 2026. Published by MDG Services on 5 November 2026.
Fuel first
This page is for a petrol pump owner whose transporters take diesel on credit. Petrol and diesel are outside GST Finance Ministry reply, Rajya Sabha, 21 Jul 2026. They carry state VAT and central excise. So for the fuel your pump sells on credit, the two GST rules below do not apply, and this page does not cover the VAT rules. They apply only to what GST does cover.
Two rules, one table
| Who | The rule | Source |
|---|---|---|
| A registered seller | GST falls due on the supply, not on the payment | CGST Act 2017, s.12 |
| The buyer | If the buyer does not pay the seller within 180 days of the invoice, the buyer must reverse the input tax credit claimed, and can claim it again once paid | CGST Act 2017, s.16(2) |
So a registered seller may pay GST on money not yet received.
A made-up example
Made-up figures, and 18% is a made-up rate. A registered seller invoices a taxable supply on 10 July 2026.
| Line | Rs |
|---|---|
| Value of supply | 1,00,000 |
| GST at 18% | 18,000 |
| Invoice total | 1,18,000 |
The seller pays the Rs 18,000 for July's period, paid or not. If the buyer has not paid by 6 January 2027 (180 days after the invoice), the buyer must reverse the Rs 18,000 of credit, and can claim it again once paid.
What this means for a pump
- Diesel on credit. No GST on the fuel, so no 180-day clock. A transporter's unpaid diesel is handled by your own steps: see getting paid.
- A polite nudge. For anything GST does cover, if your buyer is GST-registered, you can mention the 180 days as a fact. See reminder messages.
- Your bill. Khata Kavach's bill is a numbered bill, not a GST tax invoice. See kachcha bill, pakka bill and tax invoice, and billing apps and a credit book.
What this page does not cover
Registration limits change: check the current limit. For your own books, ask a chartered accountant, with your invoices in hand.
Every Khata Kavach bill carries its date, so you can see how long each one has been open. It does not file or calculate tax.
General information, not legal advice. For your own case, speak to an advocate or a chartered accountant.
Questions people ask
01Does the 180-day rule apply to diesel?
No. Petrol and diesel are outside GST, so none of this applies to fuel a pump sells to a transporter on credit. State VAT rules apply instead, and this page does not cover them.
02How can I nudge a buyer about the 180 days?
Politely, and only if the buyer is GST-registered and the supply was taxable. Do not use it for diesel sold on credit: it does not apply. You can mention the 180-day rule as a fact. It is information about their own credit, not a threat.
03How do I make a GST invoice if I use Khata Kavach?
Make GST invoices in your billing software. A Khata Kavach bill is a numbered bill and splits out no tax. Ask your chartered accountant what your bill needs.
04Do I need to register for GST?
It depends on what you sell and your turnover, and the limit has changed over time. Check the current limit with a chartered accountant. An unregistered seller may not charge GST on a bill CGST Act 2017, s.32.
Related pages
About Khata Kavach (advertisement)
Khata Kavach is a shared credit book for petrol pumps, from MDG Services. The transporter asks before each truck fills, your nozzle man sees the limit before he fills, and both of you see every fill, payment and bill. It never lends or holds money.