Manipur GST Amendment Bill: Track‑and‑Trace Mandated for Certain Goods, Penalty Fixed at ₹1 Lakh or 10% Tax for Non-Compliance [Read Bill]

The Lok Sabha has taken up the Manipur Goods and Services Tax (Second Amendment) Bill, 2025, a measure designed to bring the State GST law in step with recent changes to the Central GST framework. The Bill introduces compliance‑heavy provisions, clarifies definitions, and tightens appellate and credit rules, reflecting the GST Council’s push for uniformity across jurisdictions.

A new Section 148A empowers the Government to notify categories of goods and the persons handling them that must adopt a track‑and‑trace system. This system requires affixing a unique identification mark, such as a digital stamp or code, on goods or their packaging. Manufacturers and dealers will also need to maintain detailed records of machinery, production capacity, and operational data.

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To enforce this, Section 122B has been inserted, prescribing a penalty of ₹1 lakh or 10% of the tax due on the goods, whichever is higher, for failure to comply. This penalty is in addition to existing liabilities, signalling a strong deterrent against evasion.

Key Definition Changes includes terms like Input Service Distributor (ISD): Expanded to cover services taxed under Section 5(3) and 5(4) of the IGST Act, Local Authority: Refined to distinguish between “local fund” (linked to Panchayats) and “municipal fund” (linked to municipal bodies) and Unique Identification Marking: Newly defined under Section 2(116A) as a secure, non‑removable digital stamp or similar device.

Provisions dealing with vouchers in Sections 12(4) and 13(4) have been omitted. And a new subsection 4 has been introduced, and also Sub‑section (5) in both sections has been updated to simplify the determination of supply timing.

The phrase “plant or machinery” in Section 17(5)(d) has been clarified to mean “plant and machinery,” effective retrospectively from 1 July 2017. A new explanation has been introduced

Explanation:—For clauses (c) and (d), the expression “construction” includes re-construction, renovation, additions or alterations or repairs, to the extent of capitalization, to the said immovable property;.

Section 20 provides the manner of distribution of credit by the Input Service Distributor.

Changes to Section 34(2) prevent suppliers from reducing output tax liability unless the recipient has reversed the corresponding input tax credit or the tax burden has not been passed on.

Section 38: The term “auto‑generated statement” is replaced with “statement,” and the scope is expanded to include “other details as may be prescribed.”

Section 39: Filing of returns is now subject to “conditions and restrictions,” strengthening compliance safeguards.

Section 107(6): Appeals against penalty‑only orders require a 10% deposit of the penalty amount.

Section 112(8): Appeals to the Appellate Tribunal also mandate a 10% penalty deposit, in addition to existing requirements.

The Bill repeals the Manipur GST (Second Amendment) Ordinance, 2025, promulgated earlier, while preserving actions already taken under it.

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