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Tamil Nadu GST Department Issues SOP for Newly Registered Taxpayers

Last updated: 25 May 2024

The Tamil Nadu GST Department has released Circular No. 4/2024 (PP2/GST-15/29/2024), dated May 20, 2024, detailing the Standard Operating Procedure (SOP) for newly registered taxpayers. This initiative aims to streamline the onboarding process and ensure compliance from the outset.

Official copy of the circular has been mentioned below

Under the erstwhile TNGST Act, 1959, and TNVAT Act, 2006, the registration certificate of newly registered dealers was sent by Registered Post with Acknowledgement Due (RPAD). This communication served as a welcome bondage between the department and dealer. The acknowledgement received from Postal Department was also a proof of existence of business. However, with the introduction of online facility for registration under Total Solution Project (TSP) and TNGST Act, 2017, the communication of hard copy is not in practice and the proof of existence of place of business is available through physical verification only.

Tamil Nadu GST Department Issues SOP for Newly Registered Taxpayers

Further, the importance of eradicating the non-existent taxpayers and bill traders is emphasized in various forums and review meetings. It is felt that, the RPAD services could be effectively used for such verification in the initial stage. In order to welcome the newly registered taxpayer as a goodwill measure and also to prevent the proliferation of bill traders and nipping them in bud, the following Standard Operating Procedure, is prescribed to be followed by the field formations.

Action to be initiated by the Joint Commissioners

i. Once the registration task is approved by the Registering authority, a task will be created in the login of the jurisdictional Territorial Joint Commissioner in the TSP 2.0 Portal. The Joint Commissioners can download the draft 'Welcome letter' from the Portal. The bilingual format of 'Welcome letter' is enclosed in Annexure.

ii. The Joint Commissioners shall send the signed bilingual 'Welcome letter' to all the newly registered taxpayers through Registered Post with Acknowledgement Due (RPAD). The Reference number (RFN) and date of despatch shall be entered in the TSP Portal.

iii. Once the 'Welcome letter' is delivered, the date of delivery as per Acknowledgement shall be entered by the Joint Commissioners in the Portal and action is deemed to be completed. If the letter is undelivered, the date of return by post shall be entered by the Joint Commissioners in the Portal and the task shall be forwarded immediately to the Registering authority for further action.

Follow-up action by the Registering authority

i. A task shall be created in the login of the Registering authority in respect of those cases in which the 'Welcome letter' was not delivered/returned by post.

ii. Based on the above preliminary verification, the registering authorities shall issue a Show Cause Notice (SCN) to the taxpayer in GSTN backoffice system. The ARN, date and SCN shall be uploaded in the TSP 2.0 Portal. The Registering authority shall conduct immediate physical verification of place of business for existence of taxpayer and upload the physical verification report in FORM GST REG-30.

iii. Based on the reply received from the taxpayer for the SCN issued and physical verification report, the Registering authority may either drop or cancel the registration of taxpayer in the GST Portal.

The workflow in the system for above procedure and MIS report including the action taken on the cancellation initiated cases will be provided by Additional Commissioner (System) to all the Joint Commissioners.

All Joint Commissioners are instructed to implement the above 'Welcome letter' procedure seamlessly to create a meaningful relationship with taxpayer and monitor the follow up action by Registering authorities closely to prevent the non-existent registered taxpayers from misusing the GST system.

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