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Finance teams operating IMS without a structured Accept/Reject/Pending decision framework either reject too aggressively (losing ITC on recoverable invoices), accept too leniently (claiming ITC on misfiled or fictitious invoices), or leave too much in Pending (triggering 30-day deemed-Accept on invoices that should have been Rejected).
A three-decision framework maps each invoice to one of three outcomes based on objective tests: exact purchase-register match plus amount within tolerance triggers Accept; no purchase-register match or amount mismatch above tolerance triggers Reject; partial or ambiguous match triggers Pending with vendor follow-up. Pending items are aged with a day-25 alert before the 30-day deemed-accept threshold.
Decision-rule thresholds (amount tolerance, date tolerance), actor-role mapping (analyst, manager, controller), Pending aging alert at day 25, audit-trail capture with actor identity and timestamp per decision, and integration with vendor-management workflow for Pending follow-up.
Per-month IMS decision log with actor identity and timestamp for each Accept, Reject, and Pending, audit pack mapping decisions to purchase register and GSTR-2B lines, and Pending queue aging report ready for day-25 review.
IMS reduces the buyer’s monthly GST workflow to a single operational question repeated thousands of times: Accept, Reject, or Pending. The framework is deceptively simple. In practice, finance teams that over-Reject lose recoverable ITC. Teams that over-Accept claim ITC on misfiled or fictitious invoices and face DRC-01C notices. Teams that over-Pending accumulate a deemed-Accept liability they never reviewed. The discipline required is a structured decision framework with objective tests, role-based authority, and an aging tracker on Pending.
The Three Decisions in Plain Language
Accept means the buyer confirms: yes, this invoice is mine, the amount is correct, I want this ITC. The invoice flows into the next GSTR-2B and the ITC becomes claimable in GSTR-3B.
Reject means the buyer disclaims: no, this invoice does not belong to me, or the amount is wrong, or I never received the goods. The invoice is excluded from GSTR-2B and no ITC is available. Reject is final unless the supplier files a GSTR-1 amendment.
Pending means the buyer is undecided: I need to check, follow up with the supplier, or verify internally. The invoice is held for up to 30 days. If no further action is taken within 30 days, the system deems it Accepted and it flows into the next GSTR-2B.
The GST portal exposes these three actions as buttons on each IMS dashboard line. The mechanical interface is identical for every invoice; the decision logic that drives the click is what separates a controlled workflow from an uncontrolled one.
Objective Tests for Each Decision
A structured framework applies objective tests against the purchase register to recommend a decision:
| Test Outcome | Recommended Decision | Rationale |
|---|---|---|
| Exact match: GSTIN + invoice number + tax period + amount within tolerance | Accept | Three-key match plus amount confirms invoice ownership |
| Match on GSTIN + invoice number + tax period, amount outside tolerance | Pending | Likely supplier or buyer entry error; needs reconciliation |
| Match on GSTIN + tax period, no matching invoice number | Pending | Possible supplier-side invoice numbering issue |
| Match on invoice number, different GSTIN | Reject | Wrong-buyer filing by supplier |
| No match on any key | Reject | Invoice does not belong to buyer |
| Match identified as a credit note in purchase register | Accept with reversal | Section 34 CGST Act treatment, ITC reversed at Table 4(B) |
Tolerance for amount is typically ₹1 or 0.1 percent. Narrower tolerance catches real differences; wider tolerance ignores rounding noise.
The 30-Day Deemed-Accept Clock
The single most important timing rule in the IMS workflow is the 30-day deemed-Accept threshold. An invoice marked Pending on day 1 is automatically deemed Accepted on day 31 if no further action is taken.
This is the safety net for invoices needing supplier follow-up — it prevents indefinite deferral. It is also the trap for unwatched Pending queues — an invoice the buyer would have rejected gets quietly Accepted and the ITC is claimed against an invoice the buyer never verified.
Disciplined teams set a day-25 review alert. By day 25, the Pending invoice has had three weeks of vendor follow-up and internal verification. If the issue is unresolved, the buyer must decide: Accept and live with the unresolved item, or Reject before the deemed-Accept threshold.
Worked Example: 1,200-Invoice Month, 80/12/8 Distribution
A mid-market services firm has 1,200 inward invoices in a representative month. The objective-test framework recommends:
- 960 Accept (80 percent) — exact match, amount within tolerance.
- 96 Reject (8 percent) — no purchase-register match (wrong-buyer filings, supplier errors).
- 144 Pending (12 percent) — amount mismatch needing vendor follow-up or internal verification.
Pending breakdown by resolution:
- 95 resolved within 7 working days via vendor follow-up. Of these, 78 become Accept (vendor confirms or buyer accepts variance) and 17 become Reject (vendor confirms invoice was misfiled).
- 35 resolved between days 7 and 25 via internal verification. Of these, 30 become Accept (GRN found, purchase order located) and 5 become Reject (item never received).
- 14 unresolved at day 25, escalated to controller. Of these, 8 become Accept (controller accepts variance with supplier credit note in next month), 4 become Reject (controller writes off the disputed invoice), 2 remain Pending and roll into the next month’s queue.
Final distribution after resolution: 1,076 Accept (89.6 percent), 122 Reject (10.2 percent), 2 carried forward Pending (0.2 percent).
Total touchpoints during the month: 144 Pending reviews plus 96 explicit Rejects equals 240 manual actions, distributed across the AP analyst, AP manager, and controller. At 8 minutes per touchpoint, that is 32 hours of monthly IMS review work — feasible for a 2-person AP function plus controller oversight.
Role-Based Authority Split
A disciplined operating model assigns authority by decision type:
- AP analyst posts Accept on auto-recommended matches. No authority to Reject (one analyst rejecting valid invoices in error causes irreversible ITC loss). May mark Pending for items needing follow-up.
- AP manager posts Reject on auto-recommended rejections and reviews escalated Pending items. May convert Pending to Accept or Reject after review.
- Finance controller has override authority on disputed items, signs off on the monthly Pending aging report, and reviews any Pending items approaching day 25.
The audit trail captures actor identity per decision, satisfying internal-control requirements under ICFR for listed entities and providing the evidence chain the GST audit will examine.
Audit-Trail Evidence the GST Audit Will Examine
For each Accept decision, the audit pack should contain:
- Purchase register entry with invoice number, date, supplier GSTIN, and amount.
- IMS Accept timestamp captured from the GST portal.
- Actor identity (which AP analyst or manager posted the Accept).
- Corresponding GSTR-2B line with summary totals.
- GSTR-3B Table 4 ITC figure tying back.
For each Reject decision, additionally:
- Reason for rejection (wrong GSTIN, amount mismatch above tolerance, fictitious, etc.).
- Communication to supplier if applicable (email or portal note).
For each Pending item that aged into deemed-Accept, additionally:
- Day-25 review note and disposition.
- Vendor follow-up trail.
- Reason no explicit decision was taken before day 30.
Spreadsheet workflows rarely capture the IMS decision timestamp and actor identity. An automated workflow in a purpose-built GST reconciliation software captures all of these by default, satisfying Rule 36(4) compliance and providing the evidence chain for both internal audit and statutory GST audit.
Month-End Reconciliation Discipline
At month-end, three checks close the cycle:
- Accept count check: Number of Accepts in IMS = Number of lines in GSTR-2B with status “Accepted by recipient”. Mismatch indicates a portal-side issue.
- Pending aging check: All Pending items have an aging marker. Items above day 20 are flagged for explicit decision.
- ITC reconciliation: GSTR-3B Table 4 ITC = GSTR-2B ITC minus Section 17(5) blocked credits minus Rule 37 reversals.
These three checks are mechanical and should run automatically before GSTR-3B is finalised. For broader cross-process integration, where GST sits alongside TDS, bank, and payment-gateway reconciliation, a unified reconciliation software India handles all three checks within the same compliance workflow.
For the three-way reconciliation framing that sits underneath the Accept/Reject/Pending workflow, see IMS vs GSTR-2B reconciliation. For the downstream GSTR-2B reconciliation against GSTR-3B, see the GSTR-2B reconciliation guide, and for the full Section 16 ITC framework, ITC reconciliation under CGST Act.