GSTN has released updated APIs for IMS in sandbox, specifically in respect of actions to be taken on credit notes. The changes are expected to be implemented from July tax period. 14 June 2025

Summary of changes:

These changes primarily impact how recipients handle credit notes and other amendment documents that either reduce their ITC or create additional liability for the supplier.
Recipients will be allowed to keep Pending the credit notes and other documents (mentioned below) that reduce their ITC up to a specified period. Details of ‘specified period’ have not been published yet.
Recipients will have an option to manually enter the amount of ITC reversal applicable for such documents.

Implications:

These changes provide a significant relief to the recipients as they can carry forward credit notes, as against the existing mechanism of mandatorily accepting or rejecting in the same month.
The recipients will also be able to adjust the ITC reversal amount to the extent applicable to them.
Recipients can now add Remarks while taking actions for all document types. These remarks will be visible to the suppliers in Supplier’s view of IMS.