Businesses must now strengthen supplier due diligence, continuously monitor vendor tax compliance, perform regular GSTR-2B reconciliations, and incorporate robust contractual safeguards to protect valuable Input Tax Credit and minimize litigation risks. Statutory Framework Governing Input Tax CreditThe judgment must be understood in the context of the statutory architecture of the CGST Act. Actual payment of tax to the Government by the supplier [Section 16(2)(c)]. Section 53 – Settlement of FundsThe Gujarat High Court attached considerable significance to Section 53 dealing with settlement of IGST between the Centre and the States. Important Observations of the Gujarat High CourtThe Gujarat High Court made several noteworthy observations while upholding Section 16(2)(c):1.