GSTN Rolls Out Form for Tobacco Manufacturers to Report Inputs, Outputs to Tax Authorities

The GST Network (GSTN) has rolled out a special form for manufacturers of pan masala and tobacco products to report inputs and outputs procured with tax authorities to check evasion.

This new form GST SRM-II came within a month of GSTN rolling out form GST SRM-I for registering machines of such manufacturers. "The second form namely Form GST SRM-II is also available on the portal. Taxpayers dealing in the manufacture of Pan Masala and Tobacco products can now report the details of inputs and outputs procured and consumed for the relevant month," GSTN said in an update to its taxpayers on June 7.

Moore Singhi Executive Director Rajat Mohan said the newly available Form GST SRM-II requires detailed monthly reporting of inputs and outputs.

"This form aims to enhance transparency and accountability in the manufacturing process of Pan Masala and Tobacco products. Taxpayers must meticulously document their procurement and consumption of inputs to avoid any discrepancies and ensure accurate tax filings," Mohan said.

Taxpayers are advised to familiarise themselves with the details and instructions provided in these forms to ensure seamless compliance and avoid any potential penalties, he added.

In January, the Central Board of Indirect Taxes and Customs (CBIC) announced the introduction of a new registration and monthly return filing procedure to improve GST compliance for manufacturers of pan masala and tobacco products effective April 1. The date was later extended to May 15.

The move to overhaul the registration, record-keeping, and monthly filing of such businesses was aimed at improving GST compliance for manufacturers of pan masala and tobacco products.

The GST law was also amended via Finance Bill 2024 to say that manufacturers of pan masala, gutkha and similar tobacco products will have to pay a penalty of up to Rs 1 lakh, if they fail to register their packing machinery with GST authorities with effect from April 1.

However, this penalty provision is yet to be notified.

The procedure was to be applicable for manufacturers of pan-masala, unmanufactured tobacco (without lime tube) with or without a brand name, 'Hookah' or 'gudaku' tobacco, smoking mixtures for pipes and cigarettes, chewing tobacco (without lime tube), filter khaini, jarda scented tobacco, snuff and branded or unbranded 'Gutkha', etc.

The manufacturers of such tobacco products were required to furnish the details of packing machines being used for filling and packing of packages in Form GST SRM-I, electronically within 30 days of the notification coming into effect i.e., April 1, 2024.

The input and output statement GST SRM-II was to be filed by the 10th of the succeeding month.