TAMIL NADU GOODS AND SERVICES TAX ACT, 2017

[TAMIL NADU ACT 19 OF 2017]

UPDATED WITH AMENDMENT ACTS

TN Act No. 3 of 2019 —The Tamil Nadu Goods and Services Tax (Amendment) Act, 2019
TN Act No. 10 of 2020 —The Tamil Nadu Goods and Services Tax (Amendment) Act, 2020
TN Act No. 29 of 2020—The Tamil Nadu Goods and Services Tax (Second Amendment) Act, 2020

COMMISSIONER OF COMMERCIAL TAXES,

EZHILAGAM, CHEPAUK, CHENNAI

© GOVERNMENT OF TAMILNADU
2021
 TAMIL NADU GOODS AND SERVICES TAX ACT, 2017
[TAMIL NADU ACT 19 OF 2017]

UPDATED WITH AMENDMENT ACTS

TN Act No. 3 of 2019 —The Tamil Nadu Goods and Services Tax (Amendment) Act, 2019
TN Act No. 10 of 2020 —The Tamil Nadu Goods and Services Tax (Amendment) Act, 2020
TN Act No. 29 of 2020—The Tamil Nadu Goods and Services Tax (Second Amendment) Act, 2020

COMMISSIONER OF COMMERCIAL TAXES,

EZHILAGAM, CHEPAUK, CHENNAI

© GOVERNMENT OF TAMILNADU
2021

Note: This updated version of the Tamil Nadu Goods and Services Tax Act, 2017 as amended upto
1st January, 2021 has been prepared for convenience and easy reference of the trade and industry and
has no legal binding or force. The Acts as published in the official TAMIL NADU GOVERNMENT GAZETTE
only have the force of law. Any errors in this document may kindly be brought to notice by sending an
email to [email protected]
 THE TAMIL NADU GOODS AND SERVICES TAX ACT,2017
ARRANGEMENT OF SECTIONS.

Page
SECTIONS Heading
No.
CHAPTER I.
PRELIMINARY.
1 Short title, extent and commencement. 1
2 Definitions. 1

CHAPTER II.
ADMINISTRATION.
3 Officers under this Act. 15
4 Appointment of officers. 15
5 Powers of officers. 15
6 Authorisation of officers of Central tax as proper officer in 15
certain circumstances.

CHAPTER III.
LEVY AND COLLECTION OF TAX.
7 Scope of supply. 16
8 Tax liability on composite and mixed supplies. 17
9 Levy and collection. 17
10 Composition levy. 18
11 Power to grant exemption from tax. 22

CHAPTER IV.
TIME AND VALUE OF SUPPLY.
12 Time of supply of goods. 22
13 Time of supply of services. 24
14 Change in rate of tax in respect of supply of goods or 25
services.
15 Value of taxable supply. 26

CHAPTER V.
INPUT TAX CREDIT.
16 Eligibility and conditions for taking input tax credit. 28
17 Apportionment of credit and blocked credits. 29
18 Availability of credit in special circumstances. 32
19 Taking input tax credit in respect of inputs and capital 34
goods sent for job work.
20 Manner of distribution of credit by Input Service 35
Distributor.
21 Manner of recovery of credit distributed in excess. 36

i
 CHAPTER VI.
REGISTRATION.
22 Persons liable for registration. 36
23 Persons not liable for registration. 38
24 Compulsory registration in certain cases. 38
25 Procedure for registration. 39
26 Deemed registration. 42
27 Special provisions relating to casual taxable person and 42
non-resident taxable person.
28 Amendment of registration. 42
29 Cancellation or suspension of registration. 43
30 Revocation of cancellation of registration. 44

CHAPTER VII.
TAX INVOICE, CREDIT AND DEBIT NOTES.
31 Tax invoice. 45
31A Facility of digital payment to recipient. 48
32 Prohibition of unauthorised collection of tax. 48
33 Amount of tax to be indicated in tax invoice and other 48
documents.
34 Credit and debit notes. 48

CHAPTER VIII.
ACCOUNTS AND RECORDS.
35 Accounts and other records. 49
36 Period of retention of accounts. 50

CHAPTER IX.
RETURNS.
37 Furnishing details of outward supplies. 51
38 Furnishing details of inward supplies. 52
39 Furnishing of returns. 53
40 First Return. 55
41 Claim of input tax credit and provisional acceptance 55
thereof.
42 Matching, reversal and reclaim of input tax credit. 56
43 Matching ,reversal and reclaim of reduction in output tax 57
liability.
43A Procedure for furnishing return and availing input tax 58
credit. [NOT YET GIVEN EFFECT]
44 Annual return. 59
45 Final return. 61
46 Notice to return defaulters. 61
47 Levy of late fee. 61
48 Goods and services tax practitioners. 61

ii
 CHAPTER X.
PAYMENT OF TAX.
49 Payment of tax, interest, penalty and other amounts. 61
49A Utilisation of input tax credit subject to certain conditions. 64
49B Order of utilization of the input tax credit. 64
50 Interest on delayed payment of tax. 64
51 Tax deduction at source. 64
52 Collection of tax at source. 66
53 Transfer of input tax credit. 69
53A Transfer of certain amounts. 69

CHAPTER XI.
REFUNDS.
54 Refund of tax. 69
55 Refund in certain cases. 73
56 Interest on delayed refunds. 74
57 Consumer Welfare Fund. 74
58 Utilisation of Fund. 74

CHAPTER XII.
ASSESSMENT.
59 Self-assessment. 75
60 Provisional assessment. 75
61 Scrutiny of returns. 76
62 Assessment of non-filers of returns. 76
63 Assessment of unregistered persons. 76
64 Summary assessment in certain special cases. 77

CHAPTER XIII.
AUDIT.
65 Audit by tax authorities. 77
66 Special audit. 78

CHAPTER XIV.
INSPECTION, SEARCH, SEIZURE AND ARREST
67 Power of inspection, search and seizure. 79
68 Inspection of goods in movement. 81
69 Power to arrest. 81
70 Power to summon persons to give evidence and produce 82
documents.
71 Access to business premises. 82
72 Officers to assist proper officers. 83

iii
 CHAPTER XV.
DEMANDS AND RECOVERY
73 Determination of tax not paid or short paid or 83
erroneously refunded or input tax credit wrongly availed
or utilised for any reason other than fraud or any
wilful misstatement or suppression of facts.
74 Determination of tax not paid or short paid or 84
erroneously refunded or input tax credit wrongly availed
or utilised by reason of fraud or any wilful
misstatement or suppression of facts.
75 General provisions relating to determination of tax. 86
76 Tax collected but not paid to Government. 87
77 Tax wrongfully collected and paid to Central Government 89
or State Government.
78 Initiation of recovery proceedings. 89
79 Recovery of tax. 89
80 Payment of tax and other amount in instalments. 91
81 Transfer of property to be void in certain cases. 92
82 Tax to be first charge on property. 92
83 Provisional attachment to protect revenue in certain 92
cases.
84 Continuation and validation of certain recovery 92
proceedings.

CHAPTER XVI
LIABILITY TO PAY IN CERTAIN CASES
85 Liability in case of transfer of business. 93
86 Liability of agent and principal. 93
87 Liability in case of amalgamation or merger of 94
companies.
88 Liability in case of company in liquidation. 94
89 Liability of directors of private company. 94
90 Liability of partners of firm to pay tax. 95
91 Liability of guardians, trustees, etc. 95
92 Liability of Court of Wards, etc. 95
93 Special provisions regarding liability to pay tax, interest 96
or penalty in certain cases.
94 Liability in other cases. 97

CHAPTER XVII.
ADVANCE RULING.
95 Definitions. 98
96 Constitution of Authority for Advance Ruling. 98
97 Application for advance ruling. 99
98 Procedure on receipt of application. 99

iv
 99 Constitution of Appellate Authority for Advance Ruling. 100
100 Appeal to the Appellate Authority. 100
101 Orders of Appellate Authority. 101
101A National Appellate Authority for Advance Ruling under 101
the Central Goods and Services Tax Act shall be
Appellate Authority under this Act. [NOT YET GIVEN
EFFECT]
102 Rectification of advance ruling. 101
103 Applicability of advance ruling. 101
104 Advance ruling to be void in certain circumstances. 102
105 Powers of Authority, Appellate Authority and National 103
Appellate Authority.
106 Procedure of Authority, Appellate Authority and National 103
Appellate Authority.

CHAPTER XVIII.
APPEALS AND REVISION
107 Appeals to Appellate Authority. 103
108 Powers of Revisional Authority. 106
109 Appellate Tribunal and Benches thereof. 107
110 President and Members of Appellate Tribunal, their 107
qualification, appointment, conditions of service, etc.
111 Procedure before Appellate Tribunal. 107
112 Appeals to Appellate Tribunal. 109
113 Orders of Appellate Tribunal. 110
114 Financial and administrative powers of State President. 111
115 Interest on refund of amount paid for admission of 112
appeal.
116 Appearance by authorized representative. 112
117 Appeal to High Court. 113
118 Appeal to Supreme Court. 114
119 Sums due to be paid notwithstanding appeal, etc. 115
120 Appeal not to be filed in certain cases. 115
121 Non appealable decisions and orders. 115

CHAPTER XIX.
OFFENCES AND PENALTIES.
122 Penalty for certain offences. 116
123 Penalty for failure to furnish information return. 118
124 Fine for failure to furnish statistics. 118
125 General penalty. 118
126 General disciplines related to penalty. 119
127 Power to impose penalty in certain cases. 119
128 Power to waive penalty or fee or both. 119
129 Detention, seizure and release of goods and 119
conveyances in transit.

v
130 Confiscation of goods or conveyances and levy of 121
penalty.
131 Confiscation or penalty not to interfere with other 122
punishments.
132 Punishment for certain offences. 122
133 Liability of officers and certain other persons. 124
134 Cognizance of offences. 124
135 Presumption of culpable mental state 125
136 Relevancy of statements under certain circumstances. 125
137 Offences by Companies. 125
138 Compounding of offences. 126

CHAPTER XX.
TRANSITIONALPROVISIONS
139 Migration of existing tax payers. 127
140 Transitional arrangements for input tax credit. 127
141 Transitional provisions relating to job work. 130
142 Miscellaneous transitional provisions. 132

CHAPTER XXI
MISCELLANEOUS.
143 Job work procedure. 136
144 Presumption as to documents in certain cases. 137
145 Admissibility of micro films, facsimile copies of 138
documents and computer printouts as documents and as
evidence.
146 Common Portal. 138
147 Deemed Exports. 139
148 Special procedure for certain processes. 139
149 Goods and services tax compliance rating. 139
150 Obligation to furnish information return. 139
151 Power to collect statistics. 141
152 Bar on disclosure of information. 141
153 Taking assistance from an expert. 141
154 Power to take samples. 141
155 Burden of Proof. 141
156 Persons deemed to be public servants. 141
157 Protection of action taken under this Act. 142
158 Disclosure of information by a public servant. 142
159 Publication of information in respect of persons in certain 143
cases.
160 Assessment proceedings, etc., not to be invalid on 144
certain grounds.
161 Rectification of errors apparent on the face of record. 144
162 Bar on jurisdiction of civil courts. 144
163 Levy of fee. 145

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 164 Power of Government to make rules. 145
165 Power to make regulations. 145
166 Laying of rules, regulations and notifications. 145
167 Delegation of powers. 145
168 Power to issue instructions or directions. 146
168A Power of Government to extend time limit in special 146
circumstances.
169 Service of notice in certain circumstances. 146
170 Rounding off of tax, etc. 147
171 Anti-profiteering Measure. 147
172 Removal of difficulties. 148
173 Amendment of certain Acts. 148
174 Repeal and saving. 149
SCHEDULE I. 152
SCHEDULE II. 152
SCHEDULE III 155
Removal of Difficulties Orders. 156

vii
 The following Act of the Tamil Nadu Legislative Assembly
received the assent of the Governor on the 22nd June 2017 and
is hereby published for general information:—

ACT No. 19 OF 2017

An Act to make a provision for levy and collection of tax on

intra-State supply of goods or services or both by the
State of Tamil Nadu and the matters connected
therewith or incidental thereto.
BE it enacted by the Legislative Assembly of the State of
Tamil Nadu in the Sixty-eighth Year of the Republic of India as
follows:—

CHAPTER I.

PRELIMINARY.

Short title, extent 1. (1) This Act may be called the Tamil Nadu Goods
and commence- and Services Tax Act, 2017.
ment.
(2) It extends to the whole of the State of Tamil Nadu.
(3) It shall come into force on such date as the State
Government may, by notification, appoint:
Provided that different dates may be appointed for
different provisions of this Act and any reference in any such
provision to the commencement of this Act shall be construed as
a reference to the coming into force of that provision.

Definitions. 2. In this Act, unless the context otherwise requires,—

(1) ―actionable claim‖ shall have the same meaning as Central Act 4 of
1882.
assigned to it in section 3 of the Transfer of Property Act,1882;
(2) ―address of delivery‖ means the address of the
recipient of goods or services or both indicated on the tax invoice
issued by a registered person for delivery of such goods or
services or both;
(3) ―address on record‖ means the address of the
recipient as available in the records of the supplier;
(4) ―adjudicating authority‖ means any authority,
appointed or authorised to pass any order or decision under this
Act, but does not include the Commissioner, Revisional
Authority, the Authority for Advance Ruling, the Appellate
2
Authority for Advance Ruling, [the National Appellate Authority for
1
Advance Ruling] [the appellate Authority, the Appellate Tribunal
and the Authority referred to in sub-section (2) of section 171];
---------------------------------------------------------------------------------------
1
Substituted for ―the Appellate Authority and the Appellate Tribunal‖
by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
2
Inserted by TN Act 10 of 2020 dated 15 .02. 2020 [NOT YET GIVEN EFFECT]

1
 (5) ―agent‖ means a person, including a factor, broker,
commission agent, arhatia, del credere agent, an auctioneer or
any other mercantile agent, by whatever name called, who
carries on the business of supply or receipt of goods or services
or both on behalf of another;

(6) ―aggregate turnover‖ means the aggregate value of

all taxable supplies (excluding the value of inward supplies on
which tax is payable by a person on reverse charge basis),
exempt supplies, exports of goods or services or both and inter-
State supplies of persons having the same Permanent Account
Number, to be computed on all India basis but excludes Central
tax, State tax, Union territory tax, integrated tax and cess;

(7) ―agriculturist‖ means an individual or a Hindu

Undivided Family who undertakes cultivation of land—
(a) by own labour, or
(b) by the labour of family, or
(c) by servants on wages payable in cash or kind or
by hired labour under personal supervision or the personal
supervision of any member of the family;

(8) ―Appellate Authority‖ means an authority appointed or

authorised to hear appeals as referred to in section 107;

(9) ―Appellate Tribunal‖ means the Goods and Services

Tax Appellate Tribunal referred to in section 109;
(10) ―appointed day‖ means the date on which the
provisions of this Act shall come into force;

(11) ―assessment‖ means determination of tax liability

under this Act and includes self-assessment, re-assessment,
provisional assessment, summary assessment and best
judgement assessment;

Central Act 43 of (12) ―associated enterprises‖ shall have the same

1961. meaning as assigned to it in section 92A of the Income-tax
Act,1961;

(13) ―audit‖ means the examination of records, returns

and other documents maintained or furnished by the registered
person under this Act or the rules made thereunder or under any
other law for the time being in force to verify the correctness of
turnover declared, taxes paid, refund claimed and input tax credit
availed, and to assess his compliance with the provisions of this
Act or the rules made thereunder;

(14) ―authorised bank‖ shall mean a bank or a branch of

a bank authorised by the Central Government to collect the tax
or any other amount payable under this Act;

(15) ―authorised representative‖ means the

representative as referred to under section 116;

2
 1
(16) ―Board‖ means the [Central Board of Indirect Taxes Central Act 54
and Customs] constituted under the Central Boards of Revenue of1963.

Act,1963;
(17) ―business‖ includes—
(a) any trade, commerce, manufacture, profession,
vocation, adventure, wager or any other similar activity, whether
or not it is for a pecuniary benefit;
(b) any activity or transaction in connection with or
incidental or ancillary to sub-clause (a);
(c) any activity or transaction in the nature of sub-
clause (a), whether or not there is volume, frequency, continuity
or regularity of such transaction;
(d) supply or acquisition of goods including capital
goods and services in connection with commencement or closure
of business;
(e) provision by a club, association, society, or any
such body (for a subscription or any other consideration) of the
facilities or benefits to its members;
(f) admission, for a consideration, of persons to any
premises;
(g) services supplied by a person as the holder of an
office which has been accepted by him in the course or
furtherance of his trade, profession or vocation;
2
[(h) activities of a race club including by way of
totalisator or a license to book maker or activities of a licensed
book maker in such club; and;]
(i) any activity or transaction undertaken by the
Central Government, a State Government or any local authority
in which they are engaged as public authorities;

3
(18) [Omitted.]

------------------------------------------------------------------------------------
1
Substituted for ― Central Board of Excise and Customs‖, by TN Act 3 of 2019
dated 14.01.2019. w.e.f 01.02.2019
2
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019, Prior to
the substitution, the sub-clause (h) of clause (17) of Section 2, read as under;
‖(h) services provided by a race club by way of totalisator or a licence to
book maker in such club; and‖
3
Omitted the following by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019;
Prior to the omission, clause (18) of Section, read as under;
―(18) ―business vertical‖ means a distinguishable component of an enterprise
that is engaged in the supply of individual goods or services or a group of related
goods or services which is subject to risks and returns that are different from
those of the other business verticals‖
Explanation.— For the purposes of this clause, factors that should be
considered In determining whether goods or services are related include—
(a) the nature of the goods or services;
(b) the nature of the production processes;
(c) the type or class of customers for the goods or services;
(d) the methods used to distribute the goods or supply of services; and
(e) the nature of regulatory environment (wherever applicable),
including banking, insurance or public utilities;

3
 (19) ―capital goods‖ means goods, the value of which
is capitalized in the books of account of the person claiming the
input tax credit and which are used or intended to be used
in the course or furtherance of business;
(20) ―casual taxable person‖ means a person who
occasionally undertakes transactions involving supply of goods
or services or both in the course or furtherance of business,
whether as principal, agent or in any other capacity, in the
taxable territory where he has no fixed place of business;
(21) ―Central tax‖ means the central goods and services
tax levied under section 9 of the Central Goods and Services
Tax Act;

(22) ―cess‖ shall have the same meaning as assigned to

it in the Goods and Services Tax (Compensation to States) Act;

Central Act 38 of (23) ―chartered accountant‖ means a chartered

1949. accountant as defined in clause (b) of sub-section (1) of section
2 of the Chartered Accountants Act, 1949;

(24) ―Commissioner‖ means the Commissioner of State

tax appointed under section 3 and includes the Principal
Commissioner or Chief Commissioner of State tax appointed
under section 3;

(25) ―Commissioner in the Board‖ means the

Commissioner referred to in section 168 of the Central Goods
and Services Tax Act;

(26) ―common portal‖ means the common goods and

services tax electronic portal referred to in section146;

(27) ―common working days‖ shall mean such days in

succession which are not declared as gazetted holidays by the
Central Government or the Government of Tamil Nadu;

(28) ―company secretary‖ means a company secretary

Central Act 56 of as defined in clause (c) of sub-section (1) of section 2 of the
1980.
Company Secretaries Act, 1980;

(29) ―competent authority‖ means such authority as

may be notified by the Government;

(30) ―composite supply‖ means a supply made by a

taxable person to a recipient consisting of two or more taxable
supplies of goods or services or both, or any combination
thereof, which are naturally bundled and supplied in conjunction
with each other in the ordinary course of business, one of which
is a principal supply;

Illustration: Where goods are packed and transported

with insurance, the supply of goods, packing materials, transport
and insurance is a composite supply and supply of goods is a
principal supply.

4
 (31) ―consideration‖ in relation to the supply of goods
or services or both includes—
(a) any payment made or to be made, whether in
money or otherwise, in respect of, in response to, or for the
inducement of, the supply of goods or services or both, whether
by the recipient or by any other person but shall not include any
subsidy given by the Central Government or a State Government;
(b) the monetary value of any act or forbearance, in
respect of, in response to, or for the inducement of, the supply of
goods or services or both, whether by the recipient or by any
other person but shall not include any subsidy given by the
Central Government or a State Government:

Provided that a deposit given in respect of the supply of

goods or services or both shall not be considered as payment
made for such supply unless the supplier applies such deposit
as consideration for the said supply;

(32) ―continuous supply of goods‖ means a supply of

goods which is provided, or agreed to be provided, continuously
or on recurrent basis, under contract, whether or not by means
of a wire, cable, pipeline or other conduit, and for which the
supplier invoices the recipient on a regular or periodic basis and
includes supply of such goods as the Government may, subject
to such conditions, as it may, by notification, specify;
(33) ―continuous supply of services‖ means a supply of
services which is provided, or agreed to be provided,
continuously or on recurrent basis, under a contract, for a period
exceeding three months with periodic payment obligations and
includes supply of such services as the Government may,
subject to such conditions, as it may, by notification, specify;
(34) ―conveyance‖ includes a vessel, an aircraft and a
vehicle;
(35) ―cost accountant‖ means a cost accountant as Central Act 23 of
1
defined in [clause (b)] of sub-section (1) of Section 2 of the 1959.
Cost and Works Accountants Act, 1959;
(36) ―Council‖ means the Goods and Services Tax
Council established under article 279A of the Constitution;
(37) ―credit note‖ means a document issued by a
registered person under sub-section (1) of Section 34;
(38) ―debit note‖ means a document issued by a
registered person under sub-section (3) of section 34;
(39) ―deemed exports‖ means such supplies of goods
as may be notified under section 147;

------------------------------------------------------------------------------------
1
Substituted for ―clause(c)‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019.

5
 (40) ―designated authority‖ means such authority as
may be notified by the Commissioner;
(41) ―document‖ includes written or printed record of
Central Act 21 of any sort and electronic record as defined in clause (t) of section
2000. 2 of the Information Technology Act,2000;
(42) ―drawback‖ in relation to any goods manufactured
in India and exported, means the rebate of duty, tax or cess
chargeable on any imported inputs or on any domestic inputs or
input services used in the manufacture of such goods;
(43) ―electronic cash ledger‖ means the electronic cash
ledger referred to in sub-section (1) of section 49;
(44) ―electronic commerce‖ means the supply of goods
or services or both, including digital products over digital or
electronic network;
(45) ―electronic commerce operator‖ means any person
who owns, operates or manages digital or electronic facility or
platform for electronic commerce;
(46) ―electronic credit ledger‖ means the electronic
credit ledger referred to in sub-section (2) of section 49;
(47) ―exempt supply‖ means supply of any goods or
services or both which attracts nil rate of tax or which may be
wholly exempt from tax under section 11, or under section 6 of
the Integrated Goods and Services Tax Act, and includes non-
taxable supply;
(48) ―existing law‖ means any law, notification, order, rule
or regulation relating to levy and collection of duty or tax on
goods or services or both passed or made before the
commencement of this Act by the Legislature or any Authority or
person having the power to make such law, notification, order,
rule or regulation;
(49) ―family‖ means,—
(i) the spouse and children of the person, and
(ii) the parents, grand-parents, brothers and sisters
of the person if they are wholly or mainly dependent on the said
person;
(50) ―fixed establishment‖ means a place (other than the
registered place of business) which is characterised by a
sufficient degree of permanence and suitable structure in terms
of human and technical resources to supply services, or to
receive and use services for its own needs;
(51) ―Fund‖ means the Consumer Welfare Fund
established under section 57;
(52) ―goods‘‘ means every kind of movable property other
than money and securities but includes actionable claim, growing
crops, grass and things attached to or forming part of the land
which are agreed to be severed before supply or under a
contract of supply;

6
 (53) ―Government‖ means the Government of Tamil
Nadu;

(54) ―Goods and Services Tax (Compensation to States)

Central Act 15
Act‖ means the Goods and Services Tax (Compensation to States) of 2017.
Act, 2017;

(55) ―goods and services tax practitioner‖ means any

person who has been approved under section 48 to act as such
practitioner;

(56) ―India‖ means the territory of India as referred to in

article 1 of the Constitution, its territorial waters, seabed and
sub-soil underlying such waters, continental shelf, exclusive
economic zone or any other maritime zone as referred to in the
Territorial Waters, Continental Shelf, Exclusive Economic Zone Central Act 80
and other Maritime Zones Act, 1976, and the air space above its of 1976.
territory and territorial waters;

(57) ―Integrated Goods and Services Tax Act‖ means the Central Act 13 of
2017.
Integrated Goods and Services Tax Act,2017;

(58) ―integrated tax‖ means the integrated goods and

services tax levied under the Integrated Goods and Services Tax
Act;

(59) ―input‖ means any goods other than capital goods

used or intended to be used by a supplier in the course or
furtherance of business;

(60) ―input service‖ means any service used or intended

to be used by a supplier in the course or furtherance of business;

(61) ―Input Service Distributor‖ means an office of the

supplier of goods or services or both which receives tax invoices
issued under section 31 towards the receipt of input services
and issues a prescribed document for the purposes of
distributing the credit of Central tax, State tax, integrated tax or
Union territory tax paid on the said services to a supplier of
taxable goods or services or both having the same Permanent
Account Number as that of the said office;

(62) ―input tax‖ in relation to a registered person, means

the Central tax, State tax, Integrated tax or Union territory tax
charged on any supply of goods or services or both made to
him and includes—

(a) the integrated goods and services tax charged

on import of goods;

(b) the tax payable under the provisions of

sub-sections (3) and (4) of section 9;

(c) the tax payable under the provisions of

sub-sections (3) and (4) of section 5 of the Integrated Goods and
Services Tax Act; or

7
 (d) the tax payable under the provisions of
sub-sections (3) and 4 of section 9 of the Central Goods and
Services Tax Act, but does not include the tax paid under the
composition levy;

(63) ―input tax credit‖ means the credit of input tax;

(64) ―intra-State supply of goods‖ shall have the same

meaning as assigned to it in section 8 of the Integrated Goods
and Services Tax Act;

(65) ―intra-State supply of services‖ shall have the

same meaning as assigned to it in section 8 of the Integrated
Goods and Services Tax Act;

(66) ―invoice‖ or ―tax invoice‖ means the tax invoice

referred to in section 31;

(67) ―inward supply‖ in relation to a person, shall mean

receipt of goods or services or both whether by purchase,
acquisition or any other means, with or without consideration;

(68) ―job work‖ means any treatment or process

undertaken by a person on goods belonging to another
registered person and the expression ―job worker‖ shall be
construed accordingly;
(69) ―local authority‖ means—
(a) a ―Panchayat‖ as defined in clause (d) of article
243 of the Constitution;
(b) a ―Municipality‖ as defined in clause (e) of article
243P of the Constitution;
(c) a Municipal Committee, a Zilla Parishad, a
District Board, and any other authority legally entitled to, or
entrusted by the Central Government or any State Government
with the control or management of a municipal or local fund;

Central Act 41 of (d) a Cantonment Board as defined in section 3 of the

2006 Cantonments Act, 2006
(e) a Regional Council or a District Council
constituted under the Sixth Schedule to the Constitution
(f) a Development Board constituted under Article
1
371 [and Article 371J] of the Constitution; or
(g) a Regional Council constituted under article 371A
of the Constitution;

(70) ―location of the recipient of services‖ means,—

(a) where a supply is received at a place of business
for which the registration has been obtained, the location of such
place of business;
-------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

8
 (b) where a supply is received at a place other
than the place of business for which registration has been
obtained (a fixed establishment elsewhere), the location of such
fixed establishment;
(c) where a supply is received at more than one
establishment, whether the place of business or fixed
establishment, the location of the establishment most directly
concerned with the receipt of the supply; and
(d) in absence of such places, the location of the
usual place of residence of the recipient;
(71) ―location of the supplier of services‖ means,—
(a) where a supply is made from a place of
business for which the registration has been obtained, the
location of such place of business;
(b) where a supply is made from a place other
than the place of business for which registration has been
obtained (a fixed establishment elsewhere), the location of such
fixed establishment;
(c) where a supply is made from more than one
establishment, whether the place of business or fixed
establishment, the location of the establishment most directly
concerned with the provisions of the supply; and
(d) in absence of such places, the location of the
usual place of residence of the supplier;
(72) ―manufacture‖ means processing of raw material or
inputs in any manner that results in emergence of a new product
having a distinct name, character and use and the term
―manufacturer‖ shall be construed accordingly;
(73) ―market value‖ shall mean the full amount which a
recipient of a supply is required to pay in order to obtain the
goods or services or both of like kind and quality at or about the
same time and at the same commercial level where the recipient
and the supplier are not related;
(74) ―mixed supply‖ means two or more individual
supplies of goods or services, or any combination thereof, made
in conjunction with each other by a taxable person for a single
price where such supply does not constitute a composite supply.
Illustration: A supply of a package consisting of canned
foods, sweets, chocolates, cakes, dry fruits, aerated drinks and
fruit juices when supplied for a single price is a mixed supply.
Each of these items can be supplied separately and is not
dependent on any other. It shall not be a mixed supply if these
items are supplied separately;
(75) ―money‖ means the Indian legal tender or any
foreign currency, cheque, promissory note, bill of exchange,
letter of credit, draft, pay order, traveller cheque, money order,
postal or electronic remittance or any other instrument recognized
by the Reserve Bank of India when used as a consideration to settle

9
 an obligation or exchange with Indian legal tender of another
denomination but shall not include any currency that is held for
its numismatic value;

(76) ―motor vehicle‖ shall have the same meaning as

Central Act 59 of
1988. assigned to it in clause (28) of section 2 of the Motor Vehicles
Act,1988;

(77) ―non-resident taxable person‖ means any person

who occasionally undertakes transactions involving supply of
goods or services or both, whether as principal or agent or in
any other capacity, but who has no fixed place of business
or residence in India;

(78) ―non-taxable supply‘‘ means a supply of goods or

services or both which is not leviable to tax under this Act or
under the Integrated Goods and Services Tax Act;

(79) ―non-taxable territory‖ means the territory which is

outside the taxable territory;

(80) ―notification‖ means a notification published in the

Official Gazette and the expressions ‗notify‘ and ‗notified‘ shall
be construed accordingly;

(81) ―other territory‖ includes territories other than

those comprising in a State and those referred to in sub-
clauses (a) to (e) of clause (114);

(82) ―output tax‖ in relation to a taxable person, means

the tax chargeable under this Act on taxable supply of goods or
services or both made by him or by his agent but excludes tax
payable by him on reverse charge basis;

(83) ―outward supply‖ in relation to a taxable person,

means supply of goods or services or both, whether by sale,
transfer, barter, exchange, licence, rental, lease or disposal or
any other mode, made or agreed to be made by such person
in the course or furtherance of business;

(84) ―person‖ includes—

(a) an individual;
(b) a Hindu Undivided Family;
(c) a company;
(d) a firm;
(e) a Limited Liability Partnership;
(f) an association of persons or a body of
individuals, whether incorporated or not, in India or outside
India;
(g) any corporation established by or under any
Central Act 18 of Central Act, State Act or Provincial Act or a Government
2013. company as defined in clause (45) of section 2 of the
Companies Act, 2013;

10
 (h) any body corporate incorporated by or under
the laws of a country outside India;

(i) a co-operative society registered under any law

relating to co-operative societies;

(j) a local authority;

(k) Central Government or a State Government;

(l) society as defined under the Societies Central Act 21 of
1860.
Registration Act, 1860;

(m) trust; and

(n) every artificial juridical person, not falling

within any of the above;

(85) ―place of business‖ includes—

(a) A place from where the business is ordinarily
carried on, and includes a warehouse, a godown or any other
place where a taxable person stores his goods, supplies or
receives goods or services or both; or

(b) A place where a taxable person maintains his

books of account; or

(c) A place where a taxable person is engaged in

business through an agent, by whatever name called;

(86) ―place of supply‖ means the place of supply as

referred to in Chapter V of the Integrated Goods and Services
Tax Act;

(87) ―prescribed‘‘ means prescribed by rules made

under this Act on the recommendations of the Council;

(88) ―principal‖ means a person on whose behalf an

agent carries on the business of supply or receipt of goods or
services or both;

(89) ―principal place of business‖ means the place of

business specified as the principal place of business in the
certificate of registration;

(90) ―principal supply‖ means the supply of goods or

services which constitutes the predominant element of a
composite supply and to which any other supply forming part of
that composite supply is ancillary;

(91) ―proper officer‖ in relation to any function to be

performed under this Act, means the Commissioner or the
officer of the State tax who is assigned that function by the
Commissioner;

(92) ―quarter‖ shall mean a period comprising three

consecutive calendar months, ending on the last day of March,
June, September and December of a calendar year;

11
 (93) ―recipient‖ of supply of goods or services or both,
means—
(a) where a consideration is payable for the
supply of goods or services or both, the person who is liable to
pay that consideration;
(b) where no consideration is payable for the
supply of goods, the person to whom the goods are delivered or
made available, or to whom possession or use of the goods is
given or made available; and
(c) where no consideration is payable for the supply
of a service, the person to whom the service is rendered,

and any reference to a person to whom a supply is made shall

be construed as a reference to the recipient of the supply and
shall include an agent acting as such on behalf of the recipient in
relation to the goods or services or both supplied;

(94) ―registered person‖ means a person who is

registered under section 25 but does not include a person having
a Unique Identity Number;

(95) ―regulations‖ means the regulations made by the

Government under this Act on the recommendations of the
Council;

(96) ―removal‘‘ in relation to goods, means—

(a) despatch of the goods for delivery by the
supplier thereof or by any other person acting on behalf of such
supplier; or
(b) collection of the goods by the recipient thereof
or by any other person acting on behalf of such recipient;

(97) ―return‖ means any return prescribed or otherwise

required to be furnished by or under this Act or the rules made
thereunder.

(98) ―reverse charge‘‘ means the liability to pay tax by

the recipient of supply of goods or services or both instead of
the supplier of such goods or services or both under sub-
section (3) or sub-section (4) of section 9, or under sub-section
(3) or sub-section (4) of section 5 of the Integrated Goods and
Services Tax Act;
(99) ―Revisional Authority‖ means an authority appointed
or authorized for revision of decision or orders as referred to in
section 108;
(100) ―Schedule‖ means a Schedule appended to this
Act;
(101) ―securities‖ shall have the same meaning as
Central Act 42 of
1956. assigned to it in clause (h) of section 2 of the Securities
Contracts (Regulation) Act,1956;

12
 (102) ―services‖ means anything other than goods,
money and securities but includes activities relating to the use of
money or its conversion by cash or by any other mode, from
one form, currency or denomination, to another form, currency
or denomination for which a separate consideration is charged;
1
[Explanation.— For the removal of doubts, it is hereby
clarified that the expression ―services‖ includes facilitating or
arranging transactions in securities.]
(103) ―State‖ means the State of Tamil Nadu;
(104) ―State tax‖ means the tax levied under this Act;
(105) ―supplier‖ in relation to any goods or services or
both, shall mean the person supplying the said goods or services
or both and shall include an agent acting as such on behalf of
such supplier in relation to the goods or services or both
supplied;
(106) ―tax period‘‘ means the period for which the return
is required to be furnished;
(107) ―taxable person‖ means a person who is
registered or liable to be registered under section 22 or section
24;
(108) ―taxable supply‘‘ means a supply of goods or
services or both which is leviable to tax under this Act;
(109) ―taxable territory‘‘ means the territory to which the
provisions of this Act apply;
(110) ―telecommunication service‖ means service of any
description (including electronic mail, voice mail, data services,
audio text services, video text services, radio paging and cellular
mobile telephone services) which is made available to users by
means of any transmission or reception of signs, signals, writing,
images and sounds or intelligence of any nature, by wire, radio,
visual or other electromagnetic means;

(111) ―the Central Goods and Services Tax Act‖ means Central Act 12 of
2017.
the Central Goods and Services Tax Act,2017

(112) ―turnover in State‖ or ―turnover in Union territory‖

means the aggregate value of all taxable supplies (excluding the
value of inward supplies on which tax is payable by a person on
reverse charge basis) and exempt supplies made within a State
or Union territory by a taxable person, exports of goods or
services or both and inter-State supplies of goods or services or
both made from the State or Union territory by the said taxable
person but excludes Central tax, State tax, Union territory tax,
integrated tax and cess;

(113) ―usual place of residence‖ means—

(a) In case of an individual, the place where he
ordinarily resides;
---------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019 .

13
 (b) in other cases, the place where the person is
incorporated or otherwise legally constituted;

(114) ―Union territory‖ means the territory of,—

(a) the Andaman and Nicobar Islands;
(b) Lakshadweep;
1
(c) [Dadra and Nagar Haveli and Daman and Diu]
2
(d) [Ladakh]
(e) Chandigarh; and
(f) Other territory;

Explanation.— For the purposes of this Act, each of the

territories specified in sub-clauses (a) to (f) shall be considered to
be a separate Union territory.

(115) ―Union territory tax‖ means the Union territory

goods and services tax levied under the Union Territory Goods
and Services Tax Act;

Central Act 14 of (116) ―Union Territory Goods and Services Tax Act‖
2017. means the Union Territory Goods and Services Tax Act, 2017

(117) ―valid return‖ means a return furnished under sub-

section (1) of section 39 on which self-assessed tax has been
paid in full;

(118) ―voucher‖ means an instrument where there is an

obligation to accept it as consideration or part consideration for a
supply of goods or services or both and where the goods or
services or both to be supplied or the identities of their
potential suppliers are either indicated on the instrument itself or
in related documentation, including the terms and conditions of
use of such instrument;

(119) ―works contract‖ means a contract for building,

construction, fabrication, completion, erection, installation, fitting
out, improvement, modification, repair, maintenance, renovation,
alteration or commissioning of any immovable property wherein
transfer of property in goods (whether as goods or in some other
form) is involved in the execution of such contract;

(120) Words and expressions used and not defined in

this Act but defined in the Integrated Goods and Services Tax
Act, the Central Goods and Services Tax Act, the Union Territory
Goods and Services Tax Act and the Goods and Services Tax
(Compensation to States) Act shall have the same meanings as
assigned to them in those Acts.

---------------------------------------------------------------------------------------
1
Substituted for ―(c) Dadra and Nagar Haveli,‖ by TN Act 29 of 2020 dated
19.10.2020 w.e.f 30.06.2020
2
Substituted for ― (d) Daman and Diu‖, by TN Act 29 of 2020 dated 19.10.2020
w.e.f 30.06.2020

14
 CHAPTER II.
ADMINISTRATION.

Officers under this 3. The Government shall, by notification, appoint the

Act.
following classes of officers for the purposes of this Act, namely:—

. (a) Commissioner of State tax,

(b) Additional Commissioners of State tax,
(c) Joint Commissioners of State tax,
(d) Deputy Commissioners of State tax,
(e) Assistant Commissioners of State tax, and
(f) any other class of officers as it may deem fit: Tamil Nadu Act
32 of 2006
Provided that, the officers appointed under the Tamil Nadu
Value Added Tax Act, 2006 shall be deemed to be the officers
appointed under the provisions of this Act.

Appointment of 4. (1) The Government may, in addition to the officers as

officers.
may be notified under section 3, appoint such persons as it
may think fit to be the officers under this Act

(2) The Commissioner shall have jurisdiction over the whole

of the State, the Additional Commissioner, in respect of all or any
of the functions assigned to them, shall have jurisdiction over the
whole of the State or where the State Government so directs,
over any local area thereof, and all other officers shall, subject
to such conditions as may be specified, have jurisdiction over
the whole of the State or over such local areas as the
Commissioner may, by order, specify.

Powers of officers. 5. (1) Subject to such conditions and limitations as the

Commissioner may impose, an officer of State tax may exercise
the powers and discharge the duties conferred or imposed on
him under this Act.

(2) An officer of State tax may exercise the powers and

discharge the duties conferred or imposed under this Act on any
other officer of State tax who is subordinate to him.

(3) The Commissioner may, subject to such conditions and

limitations as may be specified in this behalf by him, delegate his
powers to any other officer who is subordinate to him.

(4) Notwithstanding anything contained in this section, an

Appellate Authority shall not exercise the powers and discharge
the duties conferred or imposed on any other officer of State tax.
Authorisation of 6. (1) Without prejudice to the provisions of this Act, the
officers of
Central tax as officers appointed under the Central Goods and Services Tax Act
proper officer are authorised to be the proper officers for the purposes of this
in certain
circumstan-
Act, subject to such conditions as the Government shall, on the
ces. recommendations of the Council, by notification, specify.

15
 (2) Subject to the conditions specified in the notification
issued under sub-section (1),—

(a) where any proper officer issues an order under this

Act, he shall also issue an order under the Central Goods and
Services Tax Act, as authorised by the said Act under intimation
to the jurisdictional officer of Central tax;

(b) where a proper officer under the Central Goods and

Services Tax Act has initiated any proceedings on a subject
matter, no proceedings shall be initiated by the proper officer
under this Act on the same subject matter.

(3) Any proceedings for rectification, appeal and revision,

wherever applicable, of any order passed by an officer appointed
under this Act, shall not lie before an officer appointed under the
Central Goods and Services Tax Act.

CHAPTER III.
LEVY AND COLLECTION OF TAX.

7. (1) For the purposes of this Act, the expression ―supply‖ Scope of supply.
includes—

(a) all forms of supply of goods or services or both such

as sale, transfer, barter, exchange, license, rental, lease or
disposal made or agreed to be made for a consideration by a
person in the course or furtherance of business;

(b) import of services for a consideration whether or not

1
in the course or furtherance of business; [and]

(c) the activities specified in Schedule I, made or agreed

2
to be made without a consideration; [****]
3
(d) [Omitted]
4
[(1A) ―Where certain activities or transactions, constitute a
supply in accordance with the provisions of sub-section (1), they
shall be treated either as supply of goods or supply of services
as referred to in Schedule II.‖;]

(2) Notwithstanding anything contained in sub-section (1),—

(a) activities or transactions specified in Schedule III; or

--------------------------------------------------------------------------------------
1
Added by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.07.2017
2
Omitted the word ――and ‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.07.2017.
3
Omitted by TN Act 3 of 2019 dated 14.01.2019, w.e.f 01.07.2017
Prior to the omission, the clause (d) of Section 7 read as under:
―(d) the activities to be treated as supply of goods or supply of services as referred
to in Schedule II‖.
4
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.07.2017.
.

16
 (b) such activities or transactions undertaken by the
Central Government, a State Government or any local authority
in which they are engaged as public authorities, as may be
notified by the Government on the recommendations of the
Council,

shall be treated neither as a supply of goods nor a supply of

services.
1
(3) Subject to the provisions of [sub-sections (1), (1A) and
(2)], the Government may, on the recommendations of the Council,
specify, by notification, the transactions that are to be treated
as—

(a) a supply of goods and not as a supply of services; or

(b) a supply of services and not as a supply of goods.

Tax liability on 8. The tax liability on a composite or a mixed supply shall be

composite and
mixed supplies.
determined in the following manner, namely:—

(a) a composite supply comprising two or more supplies,

one of which is a principal supply, shall be treated as a supply of
such principal supply; and

(b) a mixed supply comprising two or more supplies shall be

treated as a supply of that particular supply which attracts the
highest rate of tax.

Levy and 9. (1) Subject to the provisions of sub-section (2), there

collection.
shall be levied a tax called the Tamil Nadu goods and services
tax on all intra-State supplies of goods or services or both,
except on the supply of alcoholic liquor for human consumption,
on the value determined under section 15 and at such rates, not
exceeding twenty per cent., as may be notified by the
Government on the recommendations of the Council and
collected in such manner as may be prescribed and shall be
paid by the taxable person.

(2)The State tax on the supply of petroleum crude, high

speed diesel, motor spirit (commonly known as petrol), natural gas
and aviation turbine fuel, shall be levied with effect from such
date as may be notified by the Government on the
recommendations of the Council.

(3)The Government may, on the recommendations of the

Council, by notification, specify categories of supply of goods or
services or both, the tax on which shall be paid on reverse
charge basis by the recipient of such goods or services or both
and all the provisions of this Act shall apply to such recipient
as if he is the person liable for paying the tax in relation to
the supply of such goods or services or both.

-----------------------------------------------------------------------------------------
1
Substituted for ―sub-sections (1) and (2)‖, by TN Act 3 of 2019 dated 14.01.2019
w.e.f 01.07.2017.

17
 1
[(4)The Government may, on the recommendations of the
Council, by notification, specify a class of registered persons
who shall, in respect of supply of specified categories of goods
or services or both received from an unregistered supplier, pay
the tax on reverse charge basis as the recipient of such supply
of goods or services or both, and all the provisions of this Act
shall apply to such recipient as if he is the person liable for
paying the tax in relation to such supply of goods or services or
both.]

(5) The Government may, on the recommendations of the

Council, by notification, specify categories of services the tax on
intra-State supplies of which shall be paid by the electronic
commerce operator if such services are supplied through it, and all
the provisions of this Act shall apply to such electronic commerce
operator as if he is the supplier liable for paying the tax in relation
to the supply of such services:
Provided that where an electronic commerce operator does
not have a physical presence in the taxable territory, any person
representing such electronic commerce operator for any purpose in
the taxable territory shall be liable to pay tax:
Provided further that where an electronic commerce
operator does not have a physical presence in the taxable territory
and also he does not have a representative in the said territory,
such electronic commerce operator shall appoint a person in the
taxable territory for the purpose of paying tax and such person
shall be liable to pay tax.

10. (1) Notwithstanding anything to the contrary contained in Composition levy.

this Act but subject to the provisions of sub-sections (3) and (4) of
section 9, a registered person, whose aggregate turnover in the
preceding financial year did not exceed fifty lakh rupees may opt
2
to pay, [in lieu of the tax payable by him, under sub-section(1) of
section 9, an amount calculated at such rate] as may be
prescribed, but not exceeding,—
(a) one percent of the turnover in the State in case of a
manufacturer,
(b) two and a half per cent of the turnover in the State in
case of persons engaged in making supplies referred to in clause
(b) of paragraph 6 of Schedule II, and
--------------------------------------------------------------------------------------
1
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
Prior to the substitution, sub section (4) of Section 9, read as under:
―(4)The State tax in respect of the supply of taxable goods or services or both
by a supplier, who is not registered, to a registered person shall be paid by
such person on reverse charge basis as the recipient and all the provisions
of this Act shall apply to such recipient as if he is the person liable for paying
the tax in relation to the supply of such goods or services or both.―
2
Substituted for ― in lieu of the tax payable by him, an amount calculated at such
rate ―., by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019

18
 (c) half per cent of the turnover in the State in case of other
suppliers,
subject to such conditions and restrictions as may be prescribed:
Provided that the Government may, by notification, increase
the said limit of fifty lakh rupees to such higher amount, not
1
exceeding [one crore and fifty lakh rupees as may be
recommended by the Council].
2
[Provided further that a person who opts to pay tax under
clause (a) or clause (b) or clause (c) may supply services (other
than those referred to in clause (b) of paragraph 6 of Schedule II),
of value not exceeding ten per cent of turnover in the State in the
preceding financial year or five lakh rupees, whichever is higher.]
3
[Explanation - For the purposes of second proviso, the
value of exempt supply of services provided by way of extending
deposits, loans or advances in so far as the consideration is
represented by way of interest or discount shall not be taken into
account for determining the value of turnover in a State.]
-----------------------------------------------------------------------------------
1
Substituted for ―one crore rupees‖., by TN Act 3 of 2019 dated 14.01.2019
w.e.f 01.02.2019
2
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019 .
3
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f. 01.01.2020.

I. This Order may be called the Tamil Nadu Goods and Services Tax (Removal of
Difficulties) Order, 2017. For the removal of difficulties,-
(i) it is hereby clarified that if a person supplies goods and/or services referred to in
clause (b) of paragraph 6 of Schedule II of the TNGST Act and also supplies any
exempt services including services by way of extending deposits, loans or advances
in so far as the consideration is represented by way of interest or discount, the said
person shall not be ineligible for the composition scheme under section 10 subject to
the fulfilment of all other conditions specified therein.
(ii) it is further clarified that in computing his aggregate turnover in order to determine
his eligibility for composition scheme, value of supply of any exempt services
including services by way of extending deposits, loans or advances in so far as the
consideration is represented by way of interest or discount, shall not be taken into
account.
vide G.O.Ms.No.137, Commercial Taxes and Registration (B1), dated 13th
October 2017. published in Commercial Taxes and Registration Department
Notification No.II(2)/CTR/858(a-13)/2017 at page 13 in Part II-Section 2 of the
Tamil Nadu Government Gazette Extraordinary No.328 dated 13th October,
2017.
II. In supersession of the Tamil Nadu Goods and Services Tax (Removal of
Difficulties) Order, 2017, published as Commercial Taxes and Registration
Department Notification No.II(2)/CTR/858(a-13)/2017 at page 13 in Part II-
Section 2 of the Tamil Nadu Government Gazette Extraordinary, dated 13th
October, 2017, except as respects things done or omitted to be done before such
supersession, the Governor of Tamil Nadu, on recommendations of the Council,
hereby makes the following Order, namely: ––
This Order may be called the Tamil Nadu Goods and Services Tax (Removal
of Difficulties) Order, 2019.
2. For the removal of difficulties, it is hereby clarified that the value of supply of
exempt services by way of extending deposits, loans or advances in so far as the
consideration is represented by way of interest or discount, shall not be taken
into account -
(i) for determining the eligibility for composition scheme under second proviso to
sub-section (1) of Section 10;
(ii) in computing aggregate turnover in order to determine eligibility for
composition scheme.
vide G.O.Ms.No. 20, Commercial Taxes and Registration (B1), 1st February 2019.
published in Commercial Taxes and Registration Department Notification No.
II(2)/CTR/117(d-2)/2019 at page 1 in Part II-Section 2 of the Tamil Nadu
Government Gazette Extraordinary No. 42 dated 1st February, 2019.

19
 (2) The registered person shall be eligible to opt under sub-
section (1), if—
1
[(a) save as provided in sub-section (1), he is not
engaged in the supply of services;‖.]
(b) he is not engaged in making any supply of goods
6
[or services] which are not leviable to tax under this Act;
(c) he is not engaged in making any inter-State outward
6
supplies of goods [or services];
6
(d) he is not engaged in making any supply of goods [or
services] through an electronic commerce operator who is
2
required to collect tax at source under section 52; [****]
(e) he is not a manufacturer of such goods as may be
notified by the Government on the recommendations of the
3
[Council; and]
4
[(f) he is neither a casual taxable person nor a non-
resident taxable person]
Provided that where more than one registered person are
Central Act 43 of
1961 having the same Permanent Account Number (issued under the
Income-tax Act, 1961), the registered person shall not be eligible
to opt for the scheme under sub-section (1) unless all such
registered persons opt to pay tax under that sub-section.
5
[(2A) Notwithstanding anything to the contrary contained in
this act, but subject to the provisions of sub-sections (3) and (4) of
section 9, a registered person, not eligible to opt to pay tax under
sub- section (1) and sub-section (2), whose aggregate turnover in
the preceding financial year did not exceed fifty lakh rupees, may
opt to pay, in lieu of the tax payable by him under sub-section (1) of
section 9, an amount of tax calculated at such rate as may be
prescribed, but not exceeding three per cent of the turnover in
state, if he is not—
(a) engaged in making any supply of goods or services
which are not leviable to tax under this Act;
(b) engaged in making any inter-state outward supplies of
goods or services;
(c) engaged in making any supply of goods or services
through an electronic commerce operator who is required to collect
tax at source under section 52;
----------------------------------------------------------------------------------
1
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
Prior to substitution, clause (a) of sub-section (2) of Section 10 read as under:
―(a) he is not engaged in the supply of services other than supplies referred to in
clause (b) of paragraph 6 of Schedule II.
2
Omitted the word ―and‖, by TN Act 10 of 2020 dated 15.02.2020, w.e.f.
01.01.2020,
3
Substituted for the expression ―Council:‖ by TN Act 10 of 2020 dated
15.02.2020, w.e.f 01.01.2020
4
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
5
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f.01.01.2020
6
Inserted by TN Act 29 of 2020 dated 19.10.2020 w.e.f. 01.01.2021

20
 (d) a manufacturer of such goods or supplier of such
services as may be notified by the Government on the
recommendations of the Council; and
(e) a casual taxable person or a non-resident taxable person:
Provided that where more than one registered person are
having the same Permanent Account Number issued under the Central Act 43 of
1961
Income-tax Act, 1961, the registered person shall not be eligible
to opt for the scheme under this sub-section unless all such
registered persons opt to pay tax under this sub-section.;]
3) The option availed of by a registered person under sub-
1
section (1) [or sub-section (2-A) as the case may be] shall lapse
with effect from the day on which his aggregate turnover during
a financial year exceeds the limit specified under sub-section (1)
1
[or sub-section (2-A) as the case may be.]
(4) A taxable person to whom the provisions of sub-section
2
(1) [or sub-section (2-A), as the case may be] apply shall not
collect any tax from the recipient on supplies made by him nor
shall he be entitled to any credit of input tax.
(5) If the proper officer has reasons to believe that a taxable
3
person has paid tax under sub-section (1) [or sub-section (2-A), as
the case may be] despite not being eligible, such person shall, in
addition to any tax that may be payable by him under any other
provisions of this Act, be liable to a penalty and provisions of
section 73 or section 74 shall. mutatis mutandis, apply for
determination of tax and penalty
4
[―Explanation-1.— For the purposes of computing
aggregate turnover of a person for determining his eligibility to pay
tax under this section, the expression ―aggregate turnover‖ shall
include the value of supplies made by such person from the 1st day
of April of a financial year upto the date when he becomes liable for
registration under this act, but shall not include the value of exempt
supply of services provided by way of extending deposits, loans or
advances in so far as the consideration is represented by way of
interest or discount.
Explanation-2.— For the purposes of determining the tax
payable by a person under this section, the expression ―turnover in
state‖ shall not include the value of following supplies, namely:—
(i) supplies from the first day of April of a financial year up
to the date when such person becomes liable for registration under
this act; and
(ii) exempt supply of services provided by way of
extending deposits, loans or advances in so far as the
consideration is represented by way of interest or discount.‖]
-----------------------------------------------------------------------------------
1
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
2
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
3
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
4
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

21
 11. (1) Where the Government is satisfied that it is Power to grant
necessary in the public interest so to do, it may, on the exemption
from tax
recommendations of the Council, by notification, exempt
generally, either absolutely or subject to such conditions as may
be specified therein, goods or services or both of any specified
description from the whole or any part of the tax leviable thereon
with effect from such date as may be specified in such
notification.
(2) Where the Government is satisfied that it is necessary in
the public interest so to do, it may, on the recommendations of
the Council, by special order in each case, under circumstances
of an exceptional nature to be stated in such order, exempt
from payment of tax any goods or services or both on which tax
is leviable.
(3) The Government may, if it considers necessary or
expedient so to do for the purpose of clarifying the scope or
applicability of any notification issued under sub-section (1) or
order issued under sub-section (2), insert an explanation in such
notification or order, as the case maybe, by notification at any
time within one year of issue of the notification under sub-
section (1) or order under sub-section (2), and every such
explanation shall have effect as if it had always been the part
of the first such notification or order, as the case may be.

(4) Any notification issued by the Central Government, on

the recommendations of the Council, under sub-section (1) of
section 11 or order issued under sub-section (2) of the said
section of the Central Goods and Services Tax Act shall be
deemed to be a notification or, as the case may be, an order
issued under this Act.
Explanation.— For the purposes of this section, where an
exemption in respect of any goods or services or both from the
whole or part of the tax leviable thereon has been granted
absolutely, the registered person supplying such goods or services
or both shall not collect the tax, in excess of the effective rate, on
such supply of goods or services or both.

CHAPTER IV.
TIME AND VALUE OF SUPPLY.

12. (1) The liability to pay tax on goods shall arise at the time Time of supply of
goods.
of supply, as determined in accordance with the provisions of this
section.
(2)The time of supply of goods shall be the earlier of the
following dates, namely:-
(a) the date of issue of invoice by the supplier or the last
1
date on which he is required, under [*****] section 31 to issue
the invoice with respect to the supply; or
---------------------------------------------------------------------------------------
1
Omitted, the expression ―sub-section (1) of‖ by TN Act 3 of 2019 dated
14.01.2019, w.e.f 01.02.2019.

22
 (b) the date on which the supplier receives the payment
with respect to the supply:

Provided that where the supplier of taxable goods receives

an amount upto one thousand rupees in excess of the amount
indicated in the tax invoice, the time of supply to the extent of
such excess amount shall, at the option of the said supplier,
be the date of issue of invoice in respect of such excess
amount.

Explanation 1.— For the purposes of clauses (a) and (b),

―supply‖ shall be deemed to have been made to the extent it is
covered by the invoice or, as the case may be, the payment.

Explanation 2.— For the purposes of clause (b), ―the date

on which the supplier receives the payment‖ shall be the date on
which the payment is entered in his books of account or the date
on which the payment is credited to his bank account, whichever
is earlier.

(3) In case of supplies in respect of which tax is paid or

liable to be paid on reverse charge basis, the time of supply
shall be the earliest of the following dates, namely:—

(a) the date of the receipt of goods; or

(b) the date of payment as entered in the books of
account of the recipient or the date on which the payment is
debited in his bank account, whichever is earlier; or

(c) the date immediately following thirty days from the

date of issue of invoice or any other document, by whatever name
called, in lieu thereof by the supplier:

Provided that where it is not possible to determine the

time of supply under clause (a) or clause (b) or clause (c), the
time of supply shall be the date of entry in the books of account
of the recipient of supply.

(4) In case of supply of vouchers by a supplier, the time of

supply shall be—

(a) The date of issue of voucher, if the supply is

identifiable at that point; or

(b) the date of redemption of voucher, in all other cases.

(5) Where it is not possible to determine the time of supply
under the provisions of sub-section (2) or sub-section (3) or sub-
section (4), the time of supply shall—

(a) in a case where a periodical return has to be filed, be

the date on which such return is to be filed; or

(b) in any other case, be the date on which the tax is

paid.

23
 (6) The time of supply to the extent it relates to an addition
in the value of supply by way of interest, late fee or penalty for
delayed payment of any consideration shall be the date on which
the supplier receives such addition in value.

13. (1) The liability to pay tax on services shall arise at the Time of supply of
services.
time of supply, as determined in accordance with the provisions
of this section.

(2)The time of supply of services shall be the earliest of the

following dates, namely:—
(a) the date of issue of invoice by the supplier, if the
1
invoice is issued within the period prescribed under [*****]
section 31 or the date of receipt of payment, whichever is earlier;
or

(b) the date of provision of service, if the invoice is not

1
issued within the period prescribed under [******] section 31,or
the date of receipt of payment, whichever is earlier; or

(c) the date on which the recipient shows the receipt of

services in his books of account, in a case where the provisions
of clause(a) or clause (b) do not apply:

Provided that where the supplier of taxable service

receives an amount up to one thousand rupees in excess of the
amount indicated in the tax invoice, the time of supply to the
extent of such excess amount shall, at the option of the said
supplier, be the date of issue of invoice relating to such
excess amount.

Explanation.— For the purposes of clauses (a) and (b)—

(i) the supply shall be deemed to have been made to
the extent it is covered by the invoice or, as the case may be,
the payment;

(ii) ―the date of receipt of payment‖ shall be the date

on which the payment is entered in the books of account of
the supplier or the date on which the payment is credited to
his bank account, whichever is earlier.

(3) In case of supplies in respect of which tax is paid or

liable to be paid on reverse charge basis, the time of supply
shall be the earlier of the following dates, namely:—

(a) the date of payment as entered in the books of

account of the recipient or the date on which the payment is
debited in his bank account, whichever is earlier; or

(b) the date immediately following sixty days from the

date of issue of invoice or any other document, by whatever name
called, in lieu thereof by the supplier:
-----------------------------------------------------------------------------------
1
Omitted the expression ―sub-section (2) of‖, by TN Act 3 of 2019 dated
14.01.2019 w.e.f 01.02.2019.

24
 Provided that where it is not possible to determine the time
of supply under clause (a) or clause (b), the time of supply shall
be the date of entry in the books of account of the recipient of
supply:

Provided further that in case of supply by associated

enterprises, where the supplier of service is located outside
India, the time of supply shall be the date of entry in the books
of account of the recipient of supply or the date of payment,
whichever is earlier.

(4) In case of supply of vouchers by a supplier, the time of

supply shall be—

(a) the date of issue of voucher,if the supply is

identifiable at that point; or

(b) the date of redemption of voucher, in all other

cases.

(5) Where it is not possible to determine the time of supply

under the provisions of sub-section (2) or sub-section (3) or sub-
section (4), the time of supply shall—

(a) in a case where a periodical return has to be filed, be

the date on which such return is to be filed; or

(b) in any other case, be the date on which the tax is

paid.

(6) The time of supply to the extent it relates to an addition

in the value of supply by way of interest, late fee or penalty for
delayed payment of any consideration shall be the date on which
the supplier receives such addition in value.

Change in rate of 14. Notwithstanding anything contained in section 12 or

tax in respect of section 13, the time of supply, where there is a change in the
supply of goods
or services. rate of tax in respect of goods or services or both, shall be
determined in the following manner, namely:—
(a) in case the goods or services or both have been
supplied before the change in rate of tax,—
(i) where the invoice for the same has been issued
and the payment is also received after the change in rate of tax,
the time of supply shall be the date of receipt of payment or the
date of issue of invoice, whichever is earlier; or
(ii) where the invoice has been issued prior to the
change in rate of tax but payment is received after the change
in rate of tax, the time of supply shall be the date of issue of
invoice; or
(iii) where the payment has been received before
the change in rate of tax, but the invoice for the same is issued
after the change in rate of tax, the time of supply shall be the
date of receipt of payment;

25
 (b) in case the goods or services or both have been
supplied after the change in rate of tax,—
(i) where the payment is received after the change
in rate of tax but the invoice has been issued prior to the
change in rate of tax, the time of supply shall be the date of
receipt of payment; or

(ii) where the invoice has been issued and payment

is received before the change in rate of tax, the time of supply
shall be the date of receipt of payment or date of issue of
invoice , whichever is earlier; or

(iii) where the invoice has been issued after the

change in rate of tax but the payment is received before the
change in rate of tax, the time of supply shall be the date of
issue of invoice:

Provided that the date of receipt of payment shall be the

date of credit in the bank account if such credit in the bank
account is after four working days from the date of change in the
rate of tax.
Explanation.— For the purposes of this section, ―the date
of receipt of payment‖ shall be the date on which the payment is
entered in the books of account of the supplier or the date on
which the payment is credited to his bank account, whichever is
earlier.

15. (1) The value of a supply of goods or services or both Value of taxable
shall be the transaction value, which is the price actually paid or supply.

payable for the said supply of goods or services or both where

the supplier and the recipient of the supply are not related and
the price is the sole consideration for the supply.

(2) The value of supply shall include—

(a) any taxes, duties, cesses, fees and charges levied

under any law for the time being in force other than this Act, the
Central Goods and Services Tax Act and the Goods and Services
Tax (Compensation to States) Act, if charged separately by the
supplier;

(b) any amount that the supplier is liable to pay in

relation to such supply but which has been incurred by the
recipient of the supply and not included in the price actually
paid or payable for the goods or services or both;

(c) incidental expenses, including commission and

packing, charged by the supplier to the recipient of a supply and
any amount charged for anything done by the supplier in respect
of the supply of goods or services or both at the time of, or
before delivery of goods or supply of services;

(d) interest or late fee or penalty for delayed payment of

any consideration for any supply; and

26
 (e) Subsidies directly linked to the price excluding
subsidies provided by the Central Government and State
Governments.
Explanation.— For the purposes of this sub-section, the
amount of subsidy shall be included in the value of supply of the
supplier who receives the subsidy.
(3) The value of the supply shall not include any discount
which is given—
(a) before or at the time of the supply if such discount
has been duly recorded in the invoice issued in respect of such
supply; and
(b) after the supply has been effected, if—
(i) such discount is established in terms of an
agreement entered into at or before the time of such supply and
specifically linked to relevant invoices; and
(ii) input tax credit as is attributable to the discount
on the basis of document issued by the supplier has been
reversed by the recipient of the supply.
(4) Where the value of the supply of goods or services or both
cannot be determined under sub-section (1), the same shall be
determined in such manner as may be prescribed.
(5) Notwithstanding anything contained in sub-section (1) or
sub- section (4), the value of such supplies as may be notified by
the Government on the recommendations of the Council shall be
determined in such manner as may be prescribed.
Explanation.— For the purposes of this Act,—
(a) persons shall be deemed to be ―related persons‘‘ if—
(i) such persons are officers or directors of one
another‘s businesses;
(ii) such persons are legally recognized partners in
business;
(iii) such persons are employer and employee;
(iv) any person directly or indirectly owns, controls or
holds twenty-five per cent. or more of the
outstanding voting stock or shares or both of
them;
(v) one of them directly or indirectly controls the
other;
(vi) both of them are directly or indirectly controlled
by a third person;
(vii) together they directly or indirectly control a third
person; or
(viii) they are members of the same family;
(b) the term ―person‖ also includes legal persons.
(c) persons who are associated in the business of one
another in that one is the sole agent or sole distributor or sole
concessionaire, howsoever described, of the other, shall be
deemed to be related.

27
 CHAPTER V.
INPUT TAX CREDIT.
16. (1) Every registered person shall, subject to such Eligibility and
conditions and restrictions as may be prescribed and in the conditions for
taking input
manner specified in section 49, be entitled to take credit of input tax credit.
tax charged on any supply of goods or services or both to him
which are used or intended to be used in the course or
furtherance of his business and the said amount shall be credited
to the electronic credit ledger of such person.
(2) Notwithstanding anything contained in this section, no
registered person shall be entitled to the credit of any input tax in
respect of any supply of goods or services or both to him
unless,—
(a) he is in possession of a tax invoice or debit note
issued by a supplier registered under this Act, or such other tax
paying documents as may be prescribed;
(b) he has received the goods or services or both.
1
[Explanation.— For the purposes of this clause, it shall be
deemed that the registered person has received the goods or, as
the case may be, services—
(i) where the goods are delivered by the supplier to a
recipient or any other person on the direction of such registered
person, whether acting as an agent or otherwise, before or during
movement of goods, either by way of transfer of documents of title
to goods or otherwise;
(ii) where the services are provided by the supplier to any
person on the direction of and on account of such registered
person.;]
2
(c) subject to the provisions of [section 41 or Section
43A], the tax charged in respect of such supply has been
actually paid to the Government, either in cash or through
utilization of input tax credit admissible in respect of the said
supply; and

(d ) he has furnished the return under section 39:

Provided that where the goods against an invoice are received
in lots or instalments the registered person shall be entitled to take
credit upon receipt of the last lot or instalment:

Provided further that where a recipient fails to pay to the

supplier of goods or services or both, other than the supplies on
which tax is payable on reverse charge basis, the amount towards
--------------------------------------------------------------------------------------------
1
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
Prior to the substitution, Explanation to clause (b) of sub-section (2) of Section 16,
read as under:
―Explanation:-For the purposes of this clause, it shall be deemed that the
registered person has received the goods where the goods are delivered by the
supplier to a recipient or any other person on the direction of such registered
person, whether acting as an agent or otherwise, before or during movement of
goods, either by way of transfer of documents of title to goods or otherwise‖.
2
Substituted for ―Section 41‖ by TN Act 3 of 2019 dated 14.01.2019 [NOT YET
GIVEN EFFECT]

28
 the value of supply along with tax payable thereon within a period
of one hundred and eighty days from the date of issue of invoice by
the supplier, an amount equal to the input tax credit availed by
the recipient shall be added to his output tax liability, along with
interest thereon, in such manner as may be prescribed:

Provided also that the recipient shall be entitled to avail of

the credit of input tax on payment made by him of the amount
towards the value of supply of goods or services or both along with
tax payable thereon.

(3) Where the registered person has claimed depreciation

on the tax component of the cost of capital goods and plant and
Central Act 43
machinery under the provisions of the Income-tax Act, 1961, the of 1961
input tax credit on the said tax component shall not be allowed.

(4) A registered person shall not be entitled to take input

tax credit in respect of any invoice or debit note for supply of
goods or services or both after the due date of furnishing of the
return under section 39 for the month of September following the
1
end of financial year to which such invoice or [*****] debit note
pertains or furnishing of the relevant annual return, whichever is
earlier.
2
[Provided that the registered person shall be entitled to take
input tax credit after the due date of furnishing of the return under
Section 39 for the month of September, 2018 till the due date of
furnishing of the return under the said Section for the month of
March, 2019 in respect of any invoice or invoice relating to such
debit note for supply of goods or services or both made during the
financial year 2017-18, the details of which have been uploaded by
the supplier under sub-section (1) of Section 37 till the due date for
furnishing the details under sub-section (1) of said Section for the
month of March, 2019.]

Apportionment of 17. (1) Where the goods or services or both are used by
credit and the registered person partly for the purpose of any business and
blocked
credits. partly for other purposes, the amount of credit shall be restricted
to so much of the input tax as is attributable to the purposes of
his business.
(2) Where the goods or services or both are used by the
registered person partly for effecting taxable supplies including
zero-rated supplies under this Act or under the Integrated Goods
and Services Tax Act and partly for effecting exempt supplies
under the said Acts, the amount of credit shall be restricted to so
much of the input tax as is attributable to the said taxable
supplies including zero-rated supplies.
--------------------------------------------------------------------------------------------
1
Omitted the expression ―invoice relating to such‖, vide TN Act 29 of 2020 dated
19.10.2020. w.e.f 01.01.2021
2
Inserted vide the Tamil Nadu Goods and Services Tax (Second Removal of
Difficulties) Order, 2018.- G.O. Ms. No. 157, Commercial Taxes and Registration
(B1), 31st December 2018, published in Commercial Taxes and Registration
Department Notification No. II(2)/CTR/1099(e-1)/2018 at page 1 in Part II-Section
2 of the Tamil Nadu Government Gazette Extraordinary No.425 dated 31st
December, 2018.

29
 (3) The value of exempt supply under sub-section (2) shall
be such as may be prescribed, and shall include supplies on
which the recipient is liable to pay tax on reverse charge basis,
transactions in securities, sale of land and, subject to clause (b)
of paragraph 5 of Schedule II, sale of building.
1
[Explanation. — For the purposes of this sub-section, the
expression ―Value of exempt supply‖ shall not include the value
of activities or transactions specified in Schedule III, except
those specified in paragraph 5 of the said Schedule.]
(4) A banking company or a financial institution including a
non- banking financial company, engaged in supplying services
by way of accepting deposits, extending loans or advances shall
have the option to either comply with the provisions of sub-
section (2), or avail of, every month, an amount equal to fifty per
cent. of the eligible input tax credit on inputs, capital goods and
input services in that month and the rest shall lapse:
Provided that the option once exercised shall not be
withdrawn during the remaining part of the financial year:
Provided further that the restriction of fifty per cent. shall
not apply to the tax paid on supplies made by one registered
person to another registered person having the same Permanent
Account Number.
(5) Notwithstanding anything contained in sub-section (1) of
section 16 and sub-section (1)of section 18, input tax credit
shall not be available in respect of the following, namely:—
2
[(a) motor vehicles for transportation of persons having
approved seating capacity of not more than thirteen persons
(including the driver), except when they are used for making the
following taxable supplies, namely:—
(A) further supply of such motor vehicles; or
(B) transportation of passengers; or
(C) imparting training on driving such motor vehicles;
(aa) vessels and aircraft except when they are used—
(i) for making the following taxable supplies, namely:—
(A) further supply of such vessels or aircraft; or
(B) transportation of passengers; or
(C) imparting training on navigating such vessels;
or
(D) imparting training on flying such aircraft;
(ii) for transportation of goods;
---------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
2
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019, Prior to
the substitution, clause (a) and (b) of sub-section (5) of Section 17, read as under:
(a) motor vehicles and other conveyances except when they are used—
(i) for making the following taxable supplies namely:—
(A) further supply of such vehicles or conveyances; or
(B) transportation of passengers; or
(C) imparting training on driving, flying, navigating such vehicles or
conveyances;
(ii) for transportation of goods;

30
 (ab) services of general insurance, servicing, repair and
maintenance in so far as they relate to motor vehicles, vessels or
aircraft referred to in clause (a) or clause (aa):

Provided that the input tax credit in respect of such

services shall be available—

(i) where the motor vehicles, vessels or aircraft

referred to in clause (a) or clause (aa) are used for the purposes
specified therein;
(ii) where received by a taxable person engaged—
(I) in the manufacture of such motor vehicles,
vessels or aircraft; or

(II) in the supply of general insurance services in

respect of such motor vehicles, vessels or aircraft insured by him;]

(b) the following supply of goods or services or both—

(i) food and beverages, outdoor catering, beauty
treatment, health services, cosmetic and plastic surgery, leasing,
renting or hiring of motor vehicles, vessels or aircraft referred to in
clause (a) or clause (aa) except when used for the purposes
specified therein, life insurance and health insurance:

Provided that the input tax credit in respect of such

goods or services or both shall be available where an inward supply
of such goods or services or both is used by a registered person for
making an outward taxable supply of the same category of goods
or services or both or as an element of a taxable composite or
mixed supply;

(ii) membership of a club, health and fitness centre;

and
(iii) travel benefits extended to employees on vacation
such as leave or home travel concession:
Provided that the input tax credit in respect of such
goods or services or both shall be available, where it is obligatory
for an employer to provide the same to its employees under any
law for the time being in force.]
---------------------------------------------------------------------------------
2
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019, Prior to the
substitution, clause (a) and (b) of sub-section (5) of Section 17, read as under:
―(b) the following supply of goods or services or both-
(i) food and beverages, outdoor catering, beauty treatment, health services,
cosmetic and plastic surgery except where an inward supply of goods or services
or both of a particular category is used by a registered person for making an outward
taxable supply of the same category of goods or services or both or as an element
of a taxable composite or mixed supply;
(ii) membership of a club, health and fitness center;
(iii) rent-a-cab, life insurance and health insurance except where—
(A) the Government notifies the services which are obligatory for an employer to
provide to its employees under any law for the time being in force; or
(B) such inward supply of goods or services or both of a particular
category is used by a registered person for making an outward taxable supply of
the same category of goods or services or both or as part of a taxable
composite or mixed supply; and
(iv) travel benefits extended to employees on vacation such as leave or
home travel concession ;‖

31
 (c) works contract services when supplied for
construction of an immovable property (other than plant and
machinery) except where it is an input service for further supply
of works contract service;

(d) goods or services or both received by a taxable

person for construction of an immovable property (other than
plant or machinery) on his own account including when such
goods or services or both are used in the course or furtherance of
business.

Explanation.— For the purposes of 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;

(e) Goods or services or both on which tax has been paid

under Section 10;
(f) Goods or services or both received by a non-resident
taxable person except on goods imported by him;

(g) Goods or services or both used for personal

consumption;
(h) goods lost, stolen, destroyed, written off or
disposed of by way of gift or free samples; and
(i) any tax paid in accordance with the provisions of
sections 74, 129 and 130

(6) The Government may prescribe the manner in which

the credit referred to in sub-sections (1) and (2) may be
attributed.

Explanation.— For the purposes of this Chapter and

Chapter VI, the expression ―plant and machinery‖ means
apparatus, equipment, and machinery fixed to earth by foundation
or structural support that are used for making outward supply of
goods or services or both and includes such foundation and
structural supports but excludes—

(i) land, building or any other civil structures;

(ii) telecommunication towers; and
(iii) pipelines laid outside the factory premises.

18. (1) Subject to such conditions and restrictions as may be Availability of

prescribed credit in
special
(a) a person who has applied for registration under this circumstan-
ces.
Act within thirty days from the date on which he becomes liable to
registration and has been granted such registration shall be
entitled to take credit of input tax in respect of inputs held in stock
and inputs contained in semi-finished or finished goods held in
stock on the day immediately preceding the date from which
he becomes liable to pay tax under the provisions of this Act;

32
 (b) a person who takes registration under sub-section
(3) of section 25 shall be entitled to take credit of input tax in
respect of inputs held in stock and inputs contained in semi-
finished or finished goods held in stock on the day immediately
preceding the date of grant of registration;

(c) where any registered person ceases to pay tax

under section 10, he shall be entitled to take credit of input tax
in respect of inputs held in stock, inputs contained in semi-
finished or finished goods held in stock and on capital goods on
the day immediately preceding the date from which he becomes
liable to pay tax under section 9:
Provided that the credit on capital goods shall be reduced by
such percentage points as may be prescribed;

(d) where an exempt supply of goods or services or both by

a registered person becomes a taxable supply, such person shall
be entitled to take credit of input tax in respect of inputs held in
stock and inputs contained in semi-finished or finished goods
held in stock relatable to such exempt supply and on capital
goods exclusively used for such exempt supply on the day
immediately preceding the date from which such supply becomes
taxable:

Provided that the credit on capital goods shall be reduced by

such percentage points as may be prescribed.

(2) A registered person shall not be entitled to take input

tax credit under sub-section (1) in respect of any supply of
goods or services or both to him after the expiry of one year
from the date of issue of tax invoice relating to such supply.

(3) Where there is a change in the constitution of a

registered person on account of sale, merger, demerger,
amalgamation, lease or transfer of the business with the specific
provisions for transfer of liabilities, the said registered person
shall be allowed to transfer the input tax credit which remains
unutilized in his electronic credit ledger to such sold, merged,
demerged, amalgamated, leased or transferred business in
such manner as may be prescribed.

(4) Where any registered person who has availed of input

tax credit opts to pay tax under section 10 or, where the goods or
services or both supplied by him become wholly exempt, he
shall pay an amount, by way of debit in the electronic credit
ledger or electronic cash ledger, equivalent to the credit of
input tax in respect of inputs held in stock and inputs contained
in semi-finished or finished goods held in stock and on capital
goods, reduced by such percentage points as may be
prescribed, on the day immediately preceding the date of
exercising of such option or, as the case may be, the date of
such exemption:

33
 Provided that after payment of such amount, the balance of
input tax credit, if any, lying in his electronic credit ledger shall
lapse.

(5) The amount of credit under sub-section (1) and the

amount payable under sub-section (4) shall be calculated in such
manner as may be prescribed.

(6) In case of supply of capital goods or plant and

machinery, on which input tax credit has been taken, the
registered person shall pay an amount equal to the input tax
credit taken on the said capital goods or plant and machinery
reduced by such percentage points as may be prescribed or
the tax on the transaction value of such capital goods or plant and
machinery determined under section15, whichever is higher:

Provided that where refractory bricks, moulds and dies, jigs

and fixtures are supplied as scrap, the taxable person may pay
tax on the transaction value of such goods determined under
section15.

19. (1) The principal shall, subject to such conditions and Taking input tax
credit in
restrictions as may be prescribed, be allowed input tax credit on
respect of
inputs sent to a job worker for job work. inputs and
capital goods
(2) Notwithstanding anything contained in clause (b) of sub- sent for job
work.
section (2) of section 16, the principal shall be entitled to take
credit of input tax on inputs even if the inputs are directly sent to
a job worker for job work without being first brought to his place
of business.

(3) Where the inputs sent for job work are not received
back by the principal after completion of job work or otherwise or
are not supplied from the place of business of the job worker in
accordance with clause(a) or clause(b) of sub-section (1) of
section 143 within one year of being sent out, it shall be deemed
that such inputs had been supplied by the principal to the job
worker on the day when the said inputs were sent out:

Provided that where the inputs are sent directly to a job

worker, the period of one year shall be counted from the date
of receipt of inputs by the job worker.

(4) The principal shall, subject to such conditions and

restrictions as may be prescribed, be allowed input tax credit on
capital goods sent to a job worker for job work.

(5) Notwithstanding anything contained in clause (b) of sub-

section (3) of section 16, the principal shall be entitled to take
credit of input tax on capital goods even if the capital goods
are directly sent to a job worker for job work without being first
brought to his place of business.

34
 (6) Where the capital goods sent for job work are not
received back by the principal within a period of three years of
being sent out, it shall be deemed that such capital goods had
been supplied by the principal to the job worker on the day
when the said capital goods were sent out:

Provided that where the capital goods are sent directly to a

job worker, the period of three years shall be counted from the
date of receipt of capital goods by the job worker.

(7) Nothing contained in sub-section (3) or sub-section (6)

shall apply to moulds and dies, jigs and fixtures, or tools sent
out to job work.

Explanation.— For the purpose of this section, ―principal‖

means the person referred to in section 143.

Manner of 20. (1) The Input Service Distributor shall distribute the
distribution of
credit by Input
credit of State tax as State tax or integrated tax and integrated
Service tax as integrated tax or State tax, by way of issue of document
Distributor. containing the amount of input tax credit being distributed in
such manner as may be prescribed.

(2) The Input Service Distributor may distribute the credit

subject to the following conditions, namely:—

(a) the credit can be distributed to the recipients of

credit against a document containing such details as may be
prescribed;

(b) the amount of the credit distributed shall not exceed

the amount of credit available for distribution;

(c) the credit of tax paid on input services attributable to

a recipient of credit shall be distributed only to that recipient;

(d) the credit of tax paid on input services attributable to

more than one recipient of credit shall be distributed amongst
such recipients to whom the input service is attributable and
such distribution shall be pro rata on the basis of the turnover
in a State or turnover in a Union territory of such recipient, during
the relevant period, to the aggregate of the turnover of all such
recipients to whom such input service is attributable and which
are operational in the current year during the said relevant
period;

(e) the credit of tax paid on input services attributable to

all recipients of credit shall be distributed amongst such recipients
and such distribution shall be pro rata on the basis of the
turnover in a State or turnover in a Union territory of such
recipient, during the relevant period, to the aggregate of the
turnover of all recipients and which are operational in the current
year, during the said relevant period.

35
 Explanation.— For the purposes of this section,—

(a) the ―relevant period‖ shall be—

(i) if the recipients of credit have turnover in their

States or Union territories in the financial year preceding the
year during which credit is to be distributed, the said financial
year; or

(ii) if some or all recipients of the credit do not have

any turnover in their States or Union territories in the financial
year preceding the year during which the credit is to be
distributed, the last quarter for which details of such turnover of
all the recipients are available, previous to the month during
which credit is to be distributed;

(b) the expression ―recipient of credit‖ means the

supplier of goods or services or both having the same
Permanent Account Number as that of the Input Service
Distributor;

(c) the term ―turnover‖, in relation to any registered

person engaged in the supply of taxable goods as well as
goods not taxable under this Act, means the value of turnover,
reduced by the amount of any duty or tax levied under
1
[entries 84 and 92A] of List I of the Seventh Schedule to the
Constitution and entries 51 and 54 of List II of the said Schedule.

21. Where the Input Service Distributor distributes the Manner of

recovery of
credit in contravention of the provisions contained in section 20 credit
resulting in excess distribution of credit to one or more recipients distributed in
excess.
of credit, the excess credit so distributed shall be recovered from
such recipients along with interest, and the provisions of section
73 or section 74, as the case may be, shall, mutatis mutandis,
apply for determination of amount to be recovered.

CHAPTER VI.
REGISTRATION.

22. (1) Every supplier making a taxable supply of goods or Persons liable for
registration.
services or both in the State shall be liable to be registered under
this Act if his aggregate turnover in a financial year exceeds twenty
lakh rupees:

Provided that where such person makes taxable supplies of

goods or services or both from any of the special category States,
he shall be liable to be registered if his aggregate turnover in a
financial year exceeds ten lakh rupees.

---------------------------------------------------------------------------------------------------------------
1
Substituted for ―entry 84‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019

36
 1
[Provided further that where such person makes taxable
supplies of goods or services or both from a special category State
in respect of which the Central Government has enhanced the
aggregate turnover referred to in the first proviso, he shall be liable
to be registered if his aggregate turnover in a financial year
exceeds the amount equivalent to such enhanced turnover.]
2
[Provided also that the government may, on the
recommendations of the council, enhance the aggregate turnover
from twenty lakh rupees to such amount not exceeding forty lakh
rupees in case of supplier who is engaged exclusively in the supply
of goods, subject to such conditions and limitations, as may be
notified.

Explanation.— for the purposes of this sub-section, a person

shall be considered to be engaged exclusively in the supply of
goods even if he is engaged in exempt supply of services provided
by way of extending deposits, loans or advances in so far as the
consideration is represented by way of interest or discount.]

(2) Every person who, on the day immediately preceding the

appointed day, is registered or holds a license under an
existing law, shall be liable to be registered under this Act with
effect from the appointed day.

(3) Where a business carried on by a taxable person

registered under this Act is transferred, whether on account of
succession or otherwise, to another person as a going
concern, the transferee or the successor, as the case may be,
shall be liable to be registered with effect from the date of such
transfer or succession.

(4) Notwithstanding anything contained in sub-sections (1)

and (3), in a case of transfer pursuant to sanction of a scheme
or an arrangement for amalgamation or, as the case may be,
de-merger of two or more companies pursuant to an order of a
High Court, Tribunal or otherwise, the transferee shall be liable
to be registered, with effect from the date on which the Registrar
of Companies issues a certificate of incorporation giving effect
to such order of the High Court or Tribunal.

Explanation.— For the purposes of this section,—

(i) the expression ―aggregate turnover‖ shall include all
supplies made by the taxable person, whether on his own
account or made on behalf of all his principals;

(ii) the supply of goods, after completion of job work, by

a registered job worker shall be treated as the supply of goods by
the principal referred to in section 143, and the value of such
goods shall not be included in the aggregate turnover of the
registered job worker;
-------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
2
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

37
 (iii) the expression ―special category States‖ shall mean
the States as specified in sub-clause (g) of clause (4) of article
1
279A of the Constitution [except the State of Jammu and
Kashmir and the States of Arunachal Pradesh, Assam, Himachal
Pradesh, Meghalaya, Sikkim and Uttarakhand.].

23. (1) The following persons shall not be liable to registration, Persons not liable
namely:— for
registration.
(a) any person engaged exclusively in the business of
supplying goods or services or both that are not liable to tax
or wholly exempt from tax under this Act or under the
Integrated Goods and Services Tax Act;

(b) an agriculturist, to the extent of supply of produce

out of cultivation of land.
(2) The Government may, on the recommendations of the
Council, by notification, specify the category of persons who may
be exempted from obtaining registration under this Act.

24. Notwithstanding anything contained in sub-section (1) of Compulsory

registration in
section 22, the following categories of persons shall be required
certain cases.
to be registered under this Act,—

(i) persons making any inter-State taxable supply;

(ii) casual taxable persons making taxable supply;
(iii) persons who are required to pay tax under reverse
charge;
(iv) persons who are required to pay tax under sub-section
(5) of section 9;
(v) non-resident taxable persons making taxable supply;
(vi) persons who are required to deduct tax under section 51,
whether or not separately registered under this Act;

(vii) persons who make taxable supply of goods or services

or both on behalf of other taxable persons whether as an agent
or otherwise;

(viii) Input Service Distributor, whether or not separately

registered under this Act;
(ix) persons who supply goods or services or both, other
than supplies specified under sub-section (5) of section 9,
through such electronic commerce operator who is required to
collect tax at source under section 52
2
[(x) every electronic commerce operator who is required to
collect tax at source under Section 52;]
-------------------------------------------------------------------------------------
1
Inserted vide TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
2
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
Prior to the substitution, clause (x) of Section 24, read as under:
―(x) every electronic commerce operator;‖

38
 (xi) every person supplying online information and data base
access or retrieval services from a place outside India to a
person in India, other than a registered person; and

(xii) such other person or class of persons as may be

notified by the Government on the recommendations of the
Council.

Procedure for 25. (1) Every person who is liable to be registered under
registration.
section 22 or section 24 shall apply for registration within thirty
days from the date on which he becomes liable to registration, in
such manner and subject to such conditions as may be
prescribed:

Provided that a casual taxable person or a non-resident

taxable person shall apply for registration at least five days prior to
the commencement of business.
1
[Provided further that a person having a unit, as defined in
the Special Economic Zones Act, 2005 (Central Act 28 of 2005), in
a Special Economic Zone or being a Special Economic Zone
developer shall have to apply for a separate registration, as distinct
from his place of business located outside the Special Economic
Zone in the same State.;]

Explanation.— Every person who makes a supply from

the territorial waters of India shall obtain registration in the State
where the nearest point of the appropriate baseline is located in
the State.

(2) A person seeking registration under this Act shall be

granted a single registration:
2
[Provided that a person having multiple places of business
in the State may be granted a separate registration for each such
place of business, subject to such conditions as may be
prescribed.]

(3) A person, though not liable to be registered under

section 22 or section 24 may get himself registered voluntarily,
and all provisions of this Act, as are applicable to a registered
person, shall apply to such person.

(4) A person who has obtained or is required to obtain

more than one registration, whether in one State or Union
territory or more than one State or Union territory shall, in
respect of each such registration, be treated as distinct persons
for the purposes of this Act.

---------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
2
Substituted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
Prior to the substitution, proviso to sub-section (2) of Section 25 read as under:-
―Provided that a person having multiple business verticals in the State may be
granted a separate registration for each business vertical, subject to such
conditions as may be prescribed‖.

39
 (5) Where a person who has obtained or is required to
obtain registration in a State or Union territory in respect of an
establishment, has an establishment in another State or Union
territory, then such establishments shall be treated as
establishments of distinct persons for the purposes of this Act.
Central Act 43 of (6) Every person shall have a Permanent Account Number
1961
issued under the Income-tax Act, 1961 in order to be eligible for
grant of registration:

Provided that a person required to deduct tax under section

51 may have, in lieu of a Permanent Account Number, a Tax
Deduction and Collection Account Number issued under the said
Act in order to be eligible for grant of registration.
1
[(6A) Every registered person shall undergo authentication,
or furnish proof of possession of Aadhaar number, in such form and
manner and within such time as may be prescribed:

Provided that if an Aadhaar number is not assigned to the

registered person, such person shall be offered alternate and viable
means of identification in such manner as Government may, on the
recommendations of the Council, prescribe:

Provided further that in case of failure to undergo

authentication or furnish proof of possession of Aadhaar number or
furnish alternate and viable means of identification, registration
allotted to such person shall be deemed to be invalid and the other
provisions of this Act shall apply as if such person does not have a
registration.

(6B) On and from the date of notification, every individual

shall, in order to be eligible for grant of registration, undergo
authentication, or furnish proof of possession of Aadhaar number,
in such manner as the Government may, on the recommendations
of the Council, specify in the said notification:

Provided that if an Aadhaar number is not assigned to an

individual, such individual shall be offered alternate and viable
means of identification in such manner as the Government may, on
the recommendations of the Council, specify in the said notification.

(6C) On and from the date of notification, every person, other

than an individual, shall, in order to be eligible for grant of
registration, undergo authentication, or furnish proof of possession
of Aadhaar number of the Karta, Managing Director, whole time
Director, such number of partners, Members of Managing
Committee of Association, Board of Trustees, authorised
representative, authorised signatory and such other class of
persons, in such manner, as the Government may, on the
recommendations of the Council, specify in the said notification:

---------------------------------------------------------------------------------
1
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

40
 Provided that where such person or class of persons have
not been assigned the Aadhaar Number, such person or class of
persons shall be offered alternate and viable means of identification
in such manner as the Government may, on the recommendations
of the Council, specify in the said notification.

(6D) The provisions of sub-section (6A) or sub-section (6B) or

sub-section (6C) shall not apply to such person or class of persons
or any part of the State, as the Government may, on the
recommendations of the Council, specify by notification.

Explanation.— For the purposes of this section, the

expression ―Aadhaar number‖ shall have the same meaning as
Central Act 18 of
assigned to it in clause (a) of section 2 of the Aadhaar (Targeted 2016
Delivery of Financial and Other Subsidies, Benefits and Services)
Act, 2016.]

(7) Notwithstanding anything contained in sub-section (6),

a non-resident taxable person may be granted registration under
sub-section (1) on the basis of such other documents as may be
prescribed.

(8) Where a person who is liable to be registered under this

Act fails to obtain registration, the proper officer may, without
prejudice to any action which may be taken under this Act or
under any other law for the time being in force, proceed to
register such person in such manner as may be prescribed.

(9) Notwithstanding anything contained in sub-section

(1),—
(a) any specialized agency of the United Nations Central Act 46 of
1947
Organization or any Multilateral Financial Institution and
Organization notified under the United Nations (Privileges and
Immunities) Act, 1947, Consulate or Embassy of foreign
countries; and

(b) any other person or class of persons, as may be

notified by the Commissioner,

shall be granted a Unique Identity Number in such manner and for

such purposes, including refund of taxes on the notified supplies of
goods or services or both received by them, as may be prescribed.

(10) The registration or the Unique Identity Number shall

be granted or rejected after due verification in such manner and
within such period as may be prescribed.

(11) A certificate of registration shall be issued in such form

and with effect from such date as may be prescribed.

(12) A registration or a Unique Identity Number shall be

deemed to have been granted after the expiry of the period
prescribed under sub-section (10), if no deficiency has been
communicated to the applicant within that period.

41
 26. (1) The grant of registration or the Unique Identity Deemed
Number under the Central Goods and Services Tax Act shall be registration.
deemed to be a grant of registration or the Unique Identity
Number under this Act subject to the condition that the application
for registration or the Unique Identity Number has not been
rejected under this Act within the time specified in sub-section
(10) of section 25.

(2) Notwithstanding anything contained in sub-section (10) of

section 25, any rejection of application for registration or the Unique
Identity Number under the Central Goods and Services Tax Act
shall be deemed to be a rejection of application for registration
under this Act.

27. (1) The certificate of registration issued to a casual Special provisions

taxable person or a non-resident taxable person shall be valid for relating to
casual taxable
the period specified in the application for registration or ninety
person and
days from the effective date of registration, whichever is earlier, non-resident
and such person shall make taxable supplies only after the taxable
person.
issuance of the certificate of registration:
Provided that the proper officer may, on sufficient cause
being shown by the said taxable person, extend the said period
of ninety days by a further period not exceeding ninety days.
(2) A casual taxable person or a non-resident taxable
person shall, at the time of submission of application for
registration under sub-section (1) of section 25, make an
advance deposit of tax in an amount equivalent to the
estimated tax liability of such person for the period for which the
registration is sought:
Provided that where any extension of time is sought under
sub-section (1), such taxable person shall deposit an additional
amount of tax equivalent to the estimated tax liability of such
person for the period for which the extension is sought.
(3) The amount deposited under sub-section (2) shall be
credited to the electronic cash ledger of such person and shall be
utilized in the manner provided under section 49.

28. (1) Every registered person and a person to whom a Amendment of

Unique Identity Number has been assigned shall inform the registration.
proper officer of any changes in the information furnished at the
time of registration or subsequent thereto, in such form and
manner and within such period as may be prescribed.
(2) The proper officer may, on the basis of information
furnished under sub-section (1) or as ascertained by him,
approve or reject amendments in the registration particulars in
such manner and within such period as may be prescribed:
Provided that approval of the proper officer shall not be
required in respect of amendment of such particulars as may be
prescribed:

42
 Provided further that the proper officer shall not reject the
application for amendment in the registration particulars without
giving the person an opportunity of being heard.
(3) Any rejection or approval of amendments under the Central
Goods and Services Tax Act shall be deemed to be a rejection or
approval under this Act.
1
Cancellation [or 29. (1) The proper officer may, either on his own motion or
suspension] of on an application filed by the registered person or by his legal
registration.
heirs, in case of death of such person, cancel the registration, in
such manner and within such period as may be prescribed,
having regard to the circumstances where,—
(a) the business has been discontinued, transferred fully
for any reason including death of the proprietor, amalgamated
with other legal entity, demerged or otherwise disposed of; or
(b) there is any change in the constitution of the
business; or
2
[―(c) the taxable person is no longer liable to be registered
under section 22 or section 24 or intends to opt out of the
registration voluntarily made under sub-section (3) of section 25:]‖.
3
[Provided that during pendency of the proceedings relating
to cancellation of registration filed by the registered person, the
registration may be suspended for such period and in such manner
as may be prescribed]
(2) The proper officer may cancel the registration of a
person from such date, including any retrospective date, as he
may deem fit, where,—
(a) a registered person has contravened such provisions
of the Act or the rules made thereunder as may be prescribed; or
(b) a person paying tax under section 10 has not
furnished returns for three consecutive tax periods; or
(c) any registered person, other than a person specified
in clause (b), has not furnished returns for a continuous period of
six months; or
(d) any person who has taken voluntary registration
under sub- section (3) of section 25 has not commenced business
within six months from the date of registration; or
(e) registration has been obtained by means of fraud,
wilful misstatement or suppression of facts:
Provided that the proper officer shall not cancel the registration
without giving the person an opportunity of being heard.
-------------------------------------------------------------------------------------------------------------
1
Inserted, in the marginal heading. by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019.
2
Substituted by TN Act 29 of 2020 dated 19.10.2020, w.e.f 01.01.2021
Prior to the substitution, clause (c) of Section 29, read as under:
―(c) the taxable person, other than the person registered under sub-section (3)
of section 25, is no longer liable to be registered under section 22 or section 24 .
3
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

43
 1
[Provided further that during pendency of the proceedings
relating to cancellation of registration, the proper officer may
suspend the registration for such period and in such manner as
may be prescribed.]
(3)The cancellation of registration under this section shall
not affect the liability of the person to pay tax and other dues
under this Act or to discharge any obligation under this Act or the
rules made thereunder for any period prior to the date of
cancellation whether or not such tax and other dues are
determined before or after the date of cancellation.
(4)The cancellation of registration under the Central Goods
and Services Tax Act shall be deemed to be a cancellation of
registration under this Act.

(5) Every registered person whose registration is cancelled

shall pay an amount, by way of debit in the electronic credit
ledger or electronic cash ledger, equivalent to the credit of input
tax in respect of inputs held in stock and inputs contained in
semi-finished or finished goods held in stock or capital goods or
plant and machinery on the day immediately preceding the date
of such cancellation or the output tax payable on such goods,
whichever is higher, calculated in such manner as may be
prescribed:
Provided that in case of capital goods or plant and
machinery, the taxable person shall pay an amount equal to
the input tax credit taken on the said capital goods or plant and
machinery, reduced by such percentage points as may be
prescribed or the tax on the transaction value of such capital goods
or plant and machinery under section 15, whichever is higher.
(6) The amount payable under sub-section (5) shall be
calculated in such manner as may be prescribed.

30. (1) Subject to such conditions as may be prescribed, Revocation of

cancellation of
any registered person, whose registration is cancelled by the registration.
proper officer on his own motion, may apply to such officer for
revocation of cancellation of the registration in the prescribed
manner within thirty days from the date of service of the
cancellation order.
---------------------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
2
For the removal of difficulties, it is hereby clarified that for the purpose of
calculating the period of thirty days for filing application for revocation of cancellation
of registration under sub-section (1) of Section 30 of the Act for those registered
persons who were served notice under clause (b) or clause (c) of sub-section (2) of
Section 29 in the manner as provided in clause (c) or clause (d) of sub-section (1) of
Section 169 and where cancellation order was passed up to 12th June, 2020, the
later of the following dates shall be considered:-
(a) Date of service of the said cancellation order; or
(b) 31st day of August, 2020.
vide Tamil Nadu Goods and Services Tax (Removal of Difficulties) Order, 2020.
- G.O.(Ms.) No. 102, Commercial Taxes and Registration (B1), 26th June 2020
published in Commercial Taxes and Registration Department Notification No.
II(2)/CTR/383(a-4)/2020 at page 3 in Part II-Section 2 of the Tamil Nadu
Government Gazette Extraordinary No. 253 dated 26th June, 2020.

44
 1
[Provided that such period may, on sufficient cause being
shown, and for reasons to be recorded in writing, be extended,—

(a) by the Additional Commissioner or the Joint

Commissioner, as the case may be, for a period not exceeding
thirty days;

(b) by the Commissioner, for a further period not

exceeding thirty days, beyond the period specified in clause (a).]

(2) The proper officer may, in such manner and within such
period as may be prescribed, by order, either revoke
cancellation of the registration or reject the application:

Provided that the application for revocation of cancellation of

registration shall not be rejected unless the applicant has been
given an opportunity of being heard.

(3) The revocation of cancellation of registration under the

Central Goods and Services Tax Act shall be deemed to be a
revocation of cancellation of registration under this Act.

CHAPTER VII.
TAX INVOICE, CREDIT AND DEBIT NOTES.

Tax invoice. 31. (1) A registered person supplying taxable goods shall,
before or at the time of,—

(a) removal of goods for supply to the recipient, where

the supply involves movement of goods; or

(b) delivery of goods or making available thereof to the

recipient, in any other case,

issue a tax invoice showing the description, quantity and value of

goods, the tax charged thereon and such other particulars as
may be prescribed:
Provided that the Government may, on the
recommendations of the Council, by notification, specify the
categories of goods or supplies in respect of which a tax invoice
shall be issued, within such time and in such manner as may be
prescribed.
-------------------------------------------------------------------------------------------------
1
Substituted by TN Act 29 of 2020 dated 19.10.2020, w.e.f 01.01.2021,
Prior to the substitution, Proviso to sub-section (1) of Section 30, read as under:
[The proviso inserted by Tamil Nadu Goods and Services Tax (Fifth Removal of
Difficulties) Order, 2019.- G.O. Ms. No. 51, Commercial Taxes and Registration
(B1), 23rd April 2019, published in Commercial Taxes and Registration
Department Notification No. II(2)/CTR/301(f-1)/2019 at page 1 in Part II-Section 2
of the Tamil Nadu Government Gazette Extraordinary No.182, dated 23rd April,
2019.
―Provided that the registered person who was served notice under sub-section (2) of
section 29 in the manner as provided in clause (c) or clause (d) of sub-section (1) of
section 169 and who could not reply to the said notice, thereby resulting in
cancellation of his registration certificate and is hence unable to file application for
revocation of cancellation of registration under sub-section (1) of section 30 of the
Act, against such order passed up to 31-03-2019, shall be allowed to file application
for revocation of cancellation of the registration not later than 22-07-2019].‖

45
 (2) A registered person supplying taxable services shall,
before or after the provision of service but within a prescribed
period, issue a tax invoice, showing the description, value, tax
charged thereon and such other particulars as may be
prescribed:
1
[Provided that the Government may, on the
recommendations of the Council, by notification,—

(a) specify the categories of services or supplies in respect

of which a tax invoice shall be issued, within such time and in such
manner as may be prescribed;

(b) subject to the condition mentioned therein, specify the

categories of services in respect of which—

(i) any other document issued in relation to the supply

shall be deemed to be a tax invoice; or

(ii) tax invoice may not be issued.]

(3) Notwithstanding anything contained in sub-sections (1)

and (2)—

(a) a registered person may, within one month from the

date of issuance of certificate of registration and in such manner
as may be prescribed, issue a revised invoice against the invoice
already issued during the period beginning with the effective date
of registration till the date of issuance of certificate of registration
to him;

(b) a registered person may not issue a tax invoice if

the value of the goods or services or both supplied is less than
two hundred rupees subject to such conditions and in such
manner as may be prescribed;

(c) a registered person supplying exempted goods or

services or both or paying tax under the provisions of section
10 shall issue, instead of a tax invoice, a bill of supply containing
such particulars and in such manner as may be prescribed:

--------------------------------------------------------------------------------
1
Substituted by TN Act 29 of 2020 dated 19.10.2020, w.e.f 01.01.2021,
Prior to the substitution, proviso to the sub-section (2) of Section 31, read as
under:
―Provided that the Government may, on the recommendations of the Council, by
notification and subject to such conditions as may be mentioned therein, specify the
categories of services in respect of which—
(a) any other document issued in relation to the supply shall be deemed to
be a tax invoice; or
(b) tax invoice may not be issued.‖
Tamil Nadu Goods and Services Tax (Third Removal of Difficulties)Order,
2019 .- G.O. Ms. No. 36, Commercial Taxes and Registration (B1), 8th March 2019,
published in Commercial Taxes and Registration Department Notification No.
II(2)/CTR/212(i)/2019 at page 1 in Part II-Section 2 of the Tamil Nadu Government
Gazette Extraordinary No. 114, dated 8th March, 2019
For the removal of difficulties, it is hereby clarified that provisions of clause (c)
of sub-section (3) of Section 31 of the TNGST Act shall apply to a person paying
tax under the Commercial Taxes and Registration Department Notification
No.II(2)/CTR/212(g-1)/2019, published at pages 1-3 in Part II-Section 2 of the
Tamil Nadu Government Gazette Extraordinary, dated the 7th March, 2019.

46
 Provided that the registered person may not issue a bill
of supply if the value of the goods or services or both supplied is
less than two hundred rupees subject to such conditions and in
such manner as may be prescribed;

(d) a registered person shall, on receipt of advance

payment with respect to any supply of goods or services or
both, issue a receipt voucher or any other document, containing
such particulars as may be prescribed, evidencing receipt of such
payment;

(e) where, on receipt of advance payment with respect

to any supply of goods or services or both the registered person
issues a receipt voucher, but subsequently no supply is made
and no tax invoice is issued in pursuance thereof, the said
registered person may issue to the person who had made the
payment, a refund voucher against such payment;

(f) a registered person who is liable to pay tax under sub-

section(3) or sub-section (4) of section 9 shall issue an invoice
in respect of goods or services or both received by him from the
supplier who is not registered on the date of receipt of goods or
services or both;

(g) a registered person who is liable to pay tax under

sub-section 3 or sub-section (4) of section 9 shall issue a
payment voucher at the time of making payment to the supplier.

(4) In case of continuous supply of goods, where

successive statements of accounts or successive payments are
involved, the invoice shall be issued before or at the time each
such statement is issued or, as the case may be, each such
payment is received.

(5) Subject to the provisions of clause (d) of sub-section

(3), in case of continuous supply of services,—

(a) where the due date of payment is ascertainable

from the contract, the invoice shall be issued on or before the
due date of payment;

(b) where the due date of payment is not

ascertainable from the contract, the invoice shall be issued
before or at the time when the supplier of service receives the
payment;

(c) where the payment is linked to the completion of an

event, the invoice shall be issued on or before the date of
completion of that event.

(6) In a case where the supply of services ceases under a

contract before the completion of the supply, the invoice shall be
issued at the time when the supply ceases and such invoice shall
be issued to the extent of the supply made before such
cessation.

47
 (7) Notwithstanding anything contained in sub-section (1),
where the goods being sent or taken on approval for sale or
return are removed before the supply takes place, the invoice
shall be issued before or at the time of supply or six months from
the date of removal, whichever is earlier.

Explanation.— For the purposes of this section, the

expression ―tax invoice‖ shall include any revised invoice issued
by the supplier in respect of a supply made earlier.

1 1
Insertion of new [31A. The government may, on the recommendations of the [Facility of digital
section 31A payment to
council, prescribe a class of registered persons who shall provide
recipient].
prescribed modes of electronic payment to the recipient of supply of
goods or services or both made by him and give option to such
recipient to make payment accordingly, in such manner and subject
to such conditions and restrictions, as may be prescribed.]

32. (1) A person who is not a registered person shall not Prohibition of un
authorised
collect in respect of any supply of goods or services or both
collection of
any amount by way of tax under this Act. tax.

(2) No registered person shall collect tax except in

accordance with the provisions of this Act or the rules made
thereunder.

33. Notwithstanding anything contained in this Act or any Amount of tax to

be indicated in
other law for the time being in force, where any supply is made
tax invoice
for a consideration, every person who is liable to pay tax for and other
such supply shall prominently indicate in all documents relating to documents.
assessment, tax invoice and other like documents, the amount of
tax which shall form part of the price at which such supply
is made.

2
34. (1) [Where one or more tax invoices have] been issued Credit and debit
notes.
for supply of any goods or services or both and the taxable
value or tax charged in that tax invoice is found to exceed the
taxable value or tax payable in respect of such supply, or where
the goods supplied are returned by the recipient, or where
goods or services or both supplied are found to be deficient, the
registered person, who has supplied such goods or services or
3
both, may issue to the recipient [one or more credit notes for
supplies made in a financial year] containing such particulars as
may be prescribed.

(2) Any registered person who issues a credit note in

relation to a supply of goods or services or both shall
declare the details of such credit note in the return for the month
during which such credit note has been issued but not later than
--------------------------------------------------------------------------------------------------------------------------
1
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020.
2
Substituted for ―Where a tax invoice has‖ by TN Act 3 of 2019 dated 14.01.2019
w.ef. 01.02.2019.
3
Substituted for ―a credit note‖ by TN Act 3 of 2019 dated 14.01.2019
w.e.f 01.02.2019.

48
 September following the end of the financial year in which such
supply was made, or the date of furnishing of the relevant annual
return, whichever is earlier, and the tax liability shall be
adjusted in such manner as may be prescribed:

Provided that no reduction in output tax liability of the

supplier shall be permitted, if the incidence of tax and interest on
such supply has been passed on to any other person.
1
(3) [Where one or more tax invoices have] been issued for
supply of any goods or services or both and the taxable value
or tax charged in that tax invoice is found to be less than the
taxable value or tax payable in respect of such supply, the
registered person, who has supplied such goods or services or
2
both, shall issue to the recipient [one or more debit notes for
supplies made in a financial year] containing such particulars as
may be prescribed.

(4) Any registered person who issues a debit note in

relation to a supply of goods or services or both shall declare the
details of such debit note in the return for the month during which
such debit note has been issued and the tax liability shall be
adjusted in such manner as may be prescribed.

Explanation.— For the purposes of this Act, the expression

―debit note‖ shall include a supplementary invoice.

CHAPTER VIII.
ACCOUNTS AND RECORDS.

Accounts and other 35. (1) Every registered person shall keep and maintain, at
records. his principal place of business, as mentioned in the certificate of
registration, a true and correct account of—
(a) production or manufacture of goods;
(b) inward and outward supply of goods or services or
both;
(c) stock of goods;
(d) input tax credit availed;
(e) output tax payable and paid; and
(f) such other particulars as may be prescribed:
Provided that where more than one place of business is
specified in the certificate of registration, the accounts relating
to each place of business shall be kept at such places of
business:
Provided further that the registered person may keep and
maintain such accounts and other particulars in electronic form in
such manner as may be prescribed.
----------------------------------------------------------------------------------------------------
1
Substituted for ―Where a tax invoice has‖.by TN Act 3 of 2019 dated
14.01.2019, w.e.f 01.02.2019.
2
Substituted for ―a debit note‖ by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019.

49
 (2) Every owner or operator of warehouse or godown or
any other place used for storage of goods and every transporter,
irrespective of whether he is a registered person or not, shall
maintain records of the consignor, consignee and other relevant
details of the goods in such manner as may be prescribed.

(3) The Commissioner may notify a class of taxable

persons to maintain additional accounts or documents for such
purpose as may be specified therein.

(4) Where the Commissioner considers that any class of

taxable persons is not in a position to keep and maintain
accounts in accordance with the provisions of this section, he
may, for reasons to be recorded in writing, permit such class of
taxable persons to maintain accounts in such manner as may
be prescribed.

(5) Every registered person whose turnover during a

financial year exceeds the prescribed limit shall get his accounts
audited by a chartered accountant or a cost accountant and shall
submit a copy of the audited annual accounts, the reconciliation
statement under sub-section (2) of section 44 and such other
documents in such form and manner as may be prescribed.
1
[Provided that nothing contained in this sub-section shall
apply to any department of the Central Government or a State
Government or a local authority, whose books of account are
subject to audit by the Comptroller and Auditor-General of India or
an auditor appointed for auditing the accounts of local authorities
under any law for the time being in force.]

(6) Subject to the provisions of clause (h) of sub-section (5)

of section 17, where the registered person fails to account for the
goods or services or both in accordance with the provisions of
sub-section (1), the proper officer shall determine the amount of
tax payable on the goods or services or both that are not
accounted for, as if such goods or services or both had been
supplied by such person and the provisions of section 73 or
section 74, as the case may be, shall, mutatis mutandis,
apply for determination of such tax.

36. Every registered person required to keep and maintain Period of retention
of accounts.
books of account or other records in accordance with the
provisions of sub-section (1) of section 35 shall retain them
until the expiry of seventy two months from the due date of
furnishing of annual return for the year pertaining to such
accounts and records:

Provided that a registered person, who is a party to

an appeal or revision or any other proceedings before any
Appellate Authority or Revisional Authority or Appellate Tribunal

-------------------------------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

50
 or court, whether filed by him or by the Commissioner, or is under
investigation for an offence under Chapter XIX, shall retain the
books of account and other records pertaining to the subject
matter of such appeal or revision or proceedings or investigation
for a period of one year after final disposal of such appeal or
revision or proceedings or investigation, or for the period specified
above, whichever is later.

CHAPTER IX.
RETURNS.
Furnishing details 37. (1) Every registered person, other than an Input Service
of outward
supplies. Distributor, a non-resident taxable person and a person paying
tax under the provisions of section 10 or section 51 or section 52,
shall furnish, electronically, in such form and manner as may be
prescribed, the details of outward supplies of goods or services
or both effected during a tax period on or before the tenth day of
the month succeeding the said tax period and such details shall be
communicated to the recipient of the said supplies within such time
and in such manner as may be prescribed:
Provided that the registered person shall not be allowed to
furnish the details of outward supplies during the period from the
eleventh day to the fifteenth day of the month succeeding the tax
period:
Provided further that the Commissioner may, for reasons to
be recorded in writing, by notification, extend the time limit for
furnishing such details for such class of taxable persons as may
be specified therein:
Provided also that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.
(2) Every registered person who has been communicated
the details under sub-section (3) of section 38 or the details
pertaining to inward supplies of Input Service Distributor under
sub-section (4) of section 38, shall either accept or reject the
details so communicated, on or before the seventeenth day, but
not before the fifteenth day, of the month succeeding the tax
period and the details furnished by him under sub-section (1)
shall stand amended accordingly.
(3) Any registered person, who has furnished the details
under sub- section (1) for any tax period and which have remained
unmatched under section 42 or section 43, shall, upon discovery
of any error or omission therein, rectify such error or omission in
such manner as may be prescribed, and shall pay the tax and
interest, if any, in case there is a short payment of tax on
account of such error or omission ,in the return to be furnished
for such tax period:
Provided that no rectification of error or omission in respect of
the details furnished under sub-section (1) shall be allowed after
furnishing of the return under section 39 for the month of September

51
 following the end of the financial year to which such details pertain,
or furnishing of the relevant annual return, whichever is earlier.
1
[Provided further that the rectification of error or omission in
respect of the details furnished under sub-section (1) shall be
allowed after furnishing of the return under Section 39 for the month
of September, 2018 till the due date for furnishing the details under
sub-section (1) for the month of March, 2019 or for the quarter
January, 2019 to March, 2019.]
Explanation.— For the purposes of this Chapter, the
expression ―details of outward supplies‖ shall include details of
invoices, debit notes, credit notes and revised invoices issued in
relation to outward supplies made during any tax period.
38. (1) Every registered person, other than an Input Service Furnishing details
Distributor or a non-resident taxable person or a person paying of inward
supplies.
tax under the provisions of section 10 or section 51 or section 52,
shall verify, validate, modify or delete, if required, the details
relating to outward supplies and credit or debit notes
communicated under sub-section (1) of section 37 to prepare
the details of his inward supplies and credit or debit notes and
may include therein, the details of inward supplies and credit or
debit notes received by him in respect of such supplies that
have not been declared by the supplier under sub-section of
section 37.
(2) Every registered person, other than an Input Service
Distributor or a non-resident taxable person or a person paying
tax under the provisions of section 10 or section 51 or section 52,
shall furnish, electronically, the details of inward supplies of
taxable goods or services or both, including inward supplies of
goods or services or both on which the tax is payable on reverse
charge basis under this Act and inward supplies of goods or
services or both taxable under the Integrated Goods and Services
Central Act 51 Tax Act or on which integrated goods and services tax is payable
of1975 under section 3 of the Customs Tariff Act, 1975, and credit or
debit notes received in respect of such supplies during a tax
period after the tenth day but on or before the fifteenth day of the
month succeeding the tax period in such form and manner as may
be prescribed
Provided that the Commissioner may, for reasons to be
recorded in writing, by notification, extend the time limit for
furnishing such details for such class of taxable persons as may
be specified therein:
Provided further that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.
----------------------------------------------------------------------------------------
1
Inserted vide Tamil Nadu Goods and Services Tax (Second Removal of
Difficulties) Order, 2018.- G.O. Ms. No. 157, Commercial Taxes and Registration
(B1), 31st December 2018, published in Commercial Taxes and Registration
Department Notification No. II(2)/CTR/1099(e-1)/2018 at page 1 in Part II-Section
2 of the Tamil Nadu Government Gazette Extraordinary No.425, dated 31st
December, 2018.

52
 (3) The details of supplies modified, deleted or included by
the recipient and furnished under sub-section (2) shall be
communicated to the supplier concerned in such manner and
within such time as may be prescribed
(4) The details of supplies modified, deleted or included by
the recipient in the return furnished under sub-section (2) or sub-
section (4) of section 39 shall be communicated to the supplier
concerned in such manner and within such time as may be
prescribed.
(5) Any registered person, who has furnished the details
under sub- section (2) for any tax period and which have remained
unmatched under section 42 or section 43, shall, upon discovery
of any error or omission therein, rectify such error or omission in
the tax period during which such error or omission is noticed in
such manner as may be prescribed, and shall pay the tax and
interest, if any, in case there is a short payment of tax on
account of such error or omission, in the return to be furnished
for such tax period:
Provided that no rectification of error or omission in respect of
the details furnished under sub-section (2) shall be allowed after
furnishing of the return under section 39 for the month of
September following the end of the financial year to which such
details pertain, or furnishing of the relevant annual return,
whichever is earlier.
1
Furnishing of
39. (1) [Every registered person, other than an input service
returns distributor or a non-resident taxable person or a person paying
tax under the provisions of section 10 or section 51 or section 52
shall, for every calendar month or part thereof, furnish, a return,
electronically, of inward and outward supplies of goods or services
or both, input tax credit availed, tax payable, tax paid and such
other particulars, in such form and manner, and within such time,
as may be prescribed:
-----------------------------------------------------------------------------------------------------
1
Substituted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 10.11.2020. Prior to
the substitution, sub-section (1) and (2) of Section 39, read as under:
[(1). Every registered person, other than an Input Service Distributor or a non-
resident taxable person or a person paying tax under the provisions of section 10
or section 51 or section 52 shall, for every calendar month or part thereof, furnish,
in such form and manner as may be prescribed a return, electronically, of inward
and outward supplies of goods or services or both, input tax credit availed, tax
payable, tax paid and such other particulars as may be prescribed on or before the
twentieth day of the month succeeding such calendar month or part thereof.
(2). A registered person paying tax under the provisions of section 10
shall, for each quarter or part thereof, furnish, in such form and manner as
may be prescribed, a return, electronically, of turnover in the State, inward
supplies of goods or services or both, tax payable and tax paid within eighteen
days after the end of such quarter.]
[In TN Act 3 of 2019 dated 14.01.2019, amendment made to sub-section (1) of
section 39 as under:
(a) for the expression “in such form and manner as may be prescribed”, the
expression “in such form, manner and within such time as may be prescribed”
shall be substituted;
(b) the expression “on or before the twentieth day of the month succeeding
such calendar month or part thereof” shall be omitted;
(c) the following proviso shall be added, namely:—
“Provided that the Government may, on the recommendations of the Council,
notify certain classes of registered persons who shall furnish return for every
quarter or part thereof, subject to such conditions and safeguards as may be
specified therein.”; (These amended provisions were not given effect)]

53
 Provided that the government may, on the recommendations
of the council, notify certain class of registered persons who shall
furnish a return for every quarter or part thereof, subject to such
conditions and restrictions as may be specified therein.

(2) A registered person paying tax under the provisions

of section 10, shall, for each financial year or part thereof, furnish
a return, electronically, of turnover in the state, inward supplies of
goods or services or both, tax payable, tax paid and such other
particulars in such form and manner, and within such time, as may
be prescribed.;]

(3) Every registered person required to deduct tax at

source under the provisions of section 51 shall furnish, in such
form and manner as may be prescribed, a return, electronically,
for the month in which such deductions have been made within
ten days after the end of such month.

(4) Every taxable person registered as an Input Service

Distributor shall, for every calendar month or part thereof, furnish,
in such form and manner as may be prescribed, a return,
electronically, within thirteen days after the end of such month.
(5) Every registered non-resident taxable person shall, for
every calendar month or part thereof, furnish, in such form and
manner as may be prescribed, a return, electronically, within
twenty days after the end of a calendar month or within seven
days after the last day of the period of registration specified
under sub-section(1) of section 27,whichever is earlier.
(6) The Commissioner may, for reasons to be recorded in
writing, by notification, extend the time limit for furnishing the
returns under this section for such class of registered persons as
may be specified therein:
Provided that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.
1
[(7) Every registered person who is required to furnish a
return under sub-section (1), other than the person referred to in
the proviso thereto, or sub-section (3) or sub-section (5), shall pay
to the Government the tax due as per such return not later than the
last date on which he is required to furnish such return:
--------------------------------------------------------------------------------------------------
1
Substituted by TN Act 10 of 2020 dated 15.02.2020, w.e.f. 10.11.2020
Prior to the substitution, sub-section (7) of Section 39, read as under:
[(7).Every registered person, who is required to furnish a return under sub -
section (1) or sub-section (2) or sub-section (3) or sub-section (5), shall pay to
the Government the tax due as per such return not later than the last date on
which he is required to furnish such return.]
[In TN Act 3 of 2019 dated 14.01.2019, amendment made to sub-section (7) of
section 39 as under: The following proviso shall be added, namely:—
“Provided that the Government may, on the recommendations of the Council,
notify certain classes of registered persons who shall pay to the Government
the tax due or part thereof as per the return on or before the last date on which
he is required to furnish such return, subject to such conditions and safeguards
as may be specified therein.”; (This amended provisions were not given
effect)]

54
 Provided that every registered person furnishing return under
the proviso to sub section (1) shall pay to the Government, the tax
due taking into account inward and outward supplies of goods or
services or both, input tax credit availed, tax payable and such
other particulars during a month, in such form and manner, and
within such time, as may be prescribed:
Provided further that every registered person furnishing return
under sub-section (2) shall pay to the Government, the tax due
taking into account turnover in the State, inward supplies of goods
or services or both, tax payable, and such other particulars during a
quarter, in such form and manner, and within such time, as may be
prescribed.]
(8) Every registered person who is required to furnish a
return under sub-section (1) or sub-section (2) shall furnish a
return for every tax period whether or not any supplies of goods
or services or both have been made during such tax period.

(9) Subject to the provisions of sections 37 and 38, if any

registered person after furnishing a return under sub-section (1)
or sub-section (2) or sub- section (3) or sub-section (4) or sub-
section (5) discovers any omission or incorrect particulars
therein, other than as a result of scrutiny, audit, inspection or
enforcement activity by the tax authorities, he shall rectify such
1
omission or incorrect particulars [in such form and manner as
may be prescribed], subject to payment of interest under this Act:
Provided that no such rectification of any omission or
incorrect particulars shall be allowed after the due date for
furnishing of return for the month of September or second
2
quarter following [the end of the financial year to which such
details pertain] or the actual date of furnishing of relevant annual
return, whichever is earlier.
(10) A registered person shall not be allowed to furnish a
return for a tax period if the return for any of the previous tax
periods has not been furnished by him.

First Return. 40. Every registered person who has made outward supplies
in the period between the date on which he became liable to
registration till the date on which registration has been granted
shall declare the same in the first return furnished by him after
grant of registration.

Claim of input tax 41. (1) Every registered person shall, subject to such
credit and conditions and restrictions as may be prescribed, be entitled to
provisional
acceptance take the credit of eligible input tax, as self-assessed, in his
thereof. return and such amount shall be credited on a provisional basis
to his electronic credit ledger.
--------------------------------------------------------------------------------------------------
1
Substituted for ―in the return to be furnished for the month or quarter
during which such omission or incorrect particulars are noticed‖by TN Act 3
of 2019 dated 14.01.2019. [NOT YET GIVEN EFFECT]
2
Substituted for ―the end of the financial year‖by TN Act 3 of 2019 dated
14.01.2019. [NOT YET GIVEN EFFECT]

55
 (2) The credit referred to in sub-section (1) shall be utilized
only for payment of self-assessed output tax as per the return
referred to in the said sub-section.
42. (1) The details of every inward supply furnished by a
Matching, reversal
and reclaim of registered person (hereafter in this section referred to as the
input tax credit. ―recipient‖) for a tax period shall, in such manner and within such
time as may be prescribed, be matched—
(a) with the corresponding details of outward supply
furnished by the corresponding registered person (hereafter in this
section referred to as the ―supplier‖) in his valid return for the same
tax period or any preceding tax period;
(b) with the integrated goods and services tax paid
under section 3 of the Customs Tariff Act,1975 in respect of
Central Act 51 of
1975 goods imported by him; and
(c) For duplication of claims of input tax credit.
(2) The claim of input tax credit in respect of invoices or debit
notes relating to inward supply that match with the details of
corresponding outward supply or with the integrated goods and
Central Act 51 of services tax paid under section 3 of the Customs Tariff Act,
1975
1975 in respect of goods imported by him shall be finally
accepted and such acceptance shall be communicated, in such
manner as may be prescribed, to the recipient.

(3) Where the input tax credit claimed by a recipient in

respect of an inward supply is in excess of the tax declared by
the supplier for the same supply or the outward supply is not
declared by the supplier in his valid returns, the discrepancy shall
be communicated to both such persons in such manner as may
be prescribed.

(4) The duplication of claims of input tax credit shall be

communicated to the recipient in such manner as may be
prescribed.

(5) The amount in respect of which any discrepancy is

communicated under sub-section (3) and which is not rectified by
the supplier in his valid return for the month in which
discrepancy is communicated shall be added to the output tax
liability of the recipient, in such manner as may be prescribed, in
his return for the month succeeding the month in which the
discrepancy is communicated.

(6) The amount claimed as input tax credit that is found to

be in excess on account of duplication of claims shall be added to
the output tax liability of the recipient in his return for the
month in which the duplication is communicated.

(7) The recipient shall be eligible to reduce, from his output

tax liability, the amount added under sub-section (5), if the
supplier declares the details of the invoice or debit note in his
valid return within the time specified in sub-section (9) of section
39.

56
 (8) A recipient in whose output tax liability any amount has
been added under sub-section (5) or sub-section (6), shall be
liable to pay interest at the rate specified under sub-section (1) of
section 50 on the amount so added from the date of availing of
credit till the corresponding additions are made under the said
sub-sections.

(9) Where any reduction in output tax liability is accepted

under sub-section (7), the interest paid under sub-section (8)
shall be refunded to the recipient by crediting the amount in the
corresponding head of his electronic cash ledger in such manner
as may be prescribed:

Provided that the amount of interest to be credited in any

case shall not exceed the amount of interest paid by the supplier.

(10) The amount reduced from the output tax liability in

contravention of the provisions of sub-section (7) shall be added
to the output tax liability of the recipient in his return for the
month in which such contravention takes place and such
recipient shall be liable to pay interest on the amount so added at
the rate specified in sub-section (3) of section 50.

Matching, reversal
43. (1) The details of every credit note relating to outward
and reclaim of supply furnished by a registered person (hereafter in this section
reduction in
referred to as the ―supplier‖) for a tax period shall, in such
output tax
liability. manner and within such time as may be prescribed, be
matched—

(a) with the corresponding reduction in the claim for

input tax credit by the corresponding registered person
(hereafter in this section referred to as the ―recipient‖) in his valid
return for the same tax period or any subsequent tax period; and

(b) for duplication of claims for reduction in output tax

liability.

(2) The claim for reduction in output tax liability by the

supplier that matches with the corresponding reduction in the
claim for input tax credit by the recipient shall be finally accepted
and communicated, in such manner as may be prescribed, to the
supplier.

(3) Where the reduction of output tax liability in respect of

outward supplies exceeds the corresponding reduction in the
claim for input tax credit or the corresponding credit note is not
declared by the recipient in his valid returns, the discrepancy
shall be communicated to both such persons in such manner as
may be prescribed.

(4) The duplication of claims for reduction in output tax

liability shall be communicated to the supplier in such manner as
may be prescribed.

(5) The amount in respect of which any discrepancy is

communicated under sub-section (3) and which is not rectified by

57
 the recipient in his valid return for the month in which
discrepancy is communicated shall be added to the output tax
liability of the supplier, in such manner as may be prescribed, in
his return for the month succeeding the month in which the
discrepancy is communicated.

(6) The amount in respect of any reduction in output tax

liability that is found to be on account of duplication of claims shall
be added to the output tax liability of the supplier in his return for
the month in which such duplication is communicated.

(7) The supplier shall be eligible to reduce, from his output

tax liability, the amount added under sub-section (5) if the
recipient declares the details of the credit note in his valid return
within the time specified in sub- section (9) of section 39.

(8) A supplier in whose output tax liability any amount has

been added under sub-section (5) or sub-section (6), shall be
liable to pay interest at the rate specified under sub-section (1) of
section 50 in respect of the amount so added from the date of
such claim for reduction in the output tax liability till the
corresponding additions are made under the said sub-sections.

(9) Where any reduction in output tax liability is accepted

under sub-section (7), the interest paid under sub-section (8)
shall be refunded to the supplier by crediting the amount in the
corresponding head of his electronic cash ledger in such manner
as may be prescribed:

Provided that the amount of interest to be credited in any

case shall not exceed the amount of interest paid by the
recipient.

(10) The amount reduced from output tax liability in

contravention of the provisions of sub-section (7) shall be added
to the output tax liability of the supplier in his return for the month
in which such contravention takes place and such supplier shall
be liable to pay interest on the amount so added at the rate
specified in sub-section (3) of section 50.

1 1
Insertion of new [43A. (1) Notwithstanding anything contained in sub-section [Procedure for
section 43A. furnishing
(2) of section 16, section 37 or section 38, every registered person return and
shall in the returns furnished under sub-section (1) of section 39 availing input
tax credit.]
verify, validate, modify or delete the details of supplies furnished by
the suppliers.

(2) Notwithstanding anything contained in section 41, section

42 or section 43, the procedure for availing of input tax credit by the
recipient and verification thereof shall be such as may be
prescribed.
---------------------------------------------------------------------------------------
1
Inserted new section 43A by TN Act 3 of 2019 dated 14.01.2019 [NOT YET
GIVEN EFFECT]

58
 (3) The procedure for furnishing the details of outward
supplies by the supplier on the common portal, for the purposes of
availing input tax credit by the recipient shall be such as may be
prescribed.
(4) The procedure for availing input tax credit in respect of
outward supplies not furnished under sub-section (3) shall be such
as may be prescribed and such procedure may include the
maximum amount of the input tax credit which can be so availed,
not exceeding twenty per cent of the input tax credit available, on
the basis of details furnished by the suppliers under the said sub-
section.
(5) The amount of tax specified in the outward supplies for
which the details have been furnished by the supplier under sub-
section (3) shall be deemed to be the tax payable by him under the
provisions of the Act.
(6) The supplier and the recipient of a supply shall be jointly
and severally liable to pay tax or to pay the input tax credit availed,
as the case may be, in relation to outward supplies for which the
details have been furnished under sub-section (3) or sub-section (4)
but return thereof has not been furnished.
(7) For the purposes of sub-section (6), the recovery shall be
made in such manner as may be prescribed and such procedure
may provide for non-recovery of an amount of tax or input tax credit
wrongly availed not exceeding one thousand rupees.

(8) The procedure, safeguards and threshold of the tax

amount in relation to outward supplies, the details of which can be
furnished under sub-section (3) by a registered person,—
(a) within six months of taking registration;
(b) who has defaulted in payment of tax and where such
default has continued for more than two months from the due date
of payment of such defaulted amount,
shall be such as may be prescribed.]

44. (1) Every registered person, other than an Input Service

Annual Return.
Distributor a person paying tax under section 51 or section 52, a
casual taxable person and a non-resident taxable person, shall
furnish an annual return for every financial year electronically in
such form and manner as may be prescribed on or before the
thirty-first day of December following the end of such financial
year.
1
[Provided that the Commissioner may, on the
recommendations of the Council and for reasons to be recorded in
writing, by notification, extend the time limit for furnishing the annual
return for such class of registered persons as may be specified
therein:
---------------------------------------------------------------------------------------
1
Inserted by TN Act No10 of 2020 dated 15.02. 2020 w.e.f 01.01.2020

59
 Provided further that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.]

(2) Every registered person who is required to get his

accounts audited in accordance with the provisions of sub-
section (5) of section 35 shall furnish, electronically, the annual
return under sub-section (1) along with a copy of the audited
annual accounts and a reconciliation statement, reconciling
the value of supplies declared in the return furnished for the
financial year with the audited annual financial statement, and
such other particulars as may be prescribed.
1
[Explanation: For the purposes of this section, it is hereby
declared that the annual return for the period from the 1st July,
2017 to the 31st March, 2018 shall be furnished on or before the
2 2
[31st January 2020] and the annual return for the period from
the 1st April 2018 to the 31st March 2019 shall be furnished on
1
or before the 31st March 2020]
----------------------------------------------------------------------------------------
1
Substituted by Tamil Nadu Goods and Services Tax (Eighth Removal of
difficulties) Order 2019 - G.O.(Ms) No 182, Commercial Taxes and Registration
(B1) dated 18th November 2019 published in Commercial Taxes and Registration
Department Notification No. II(2)/CTR/917(a)/2019 at page 1 in Part II-Section 2 of
the Tamil Nadu Government Gazette Extraordinary No.427, dated 18th
November, 2019
Prior to the substitution, Explanation to sub-section (2) of Section 44 read as under:
@
[Explanation; For the purposes of this section, it is hereby declared that the annual
return for the period from the 1st July, 2017 to the 31st March, 2018 shall be
furnished on or before the 31st March 2019]@ #[30th June 2019]# $[31st August
2019]$ %[30th November 2019]%
2
Substituted, for the figures, letters and word ―31st December 2019‖ by Tamil
Nadu Goods and Services Tax (Tenth Removal of difficulties) Order 2019
G.O.(Ms) No 200 , Commercial Taxes and Registration (B1) dated 30th December
2019 published in Commercial Taxes and Registration Department Notification
No. SRO A-46(a-2)/2019 at page 2 in Part III-Section 1(a) of the Tamil Nadu
Government Gazette Extraordinary No.478, dated 30th December, 2019
@
Inserted by Tamil Nadu Goods and Services Tax (Removal of difficulties)
Order 2018 - G.O.Ms No156 , Commercial Taxes and Registration (B1) dated 12 th
Dec 2018, published in Commercial Taxes and Registration Department
Notification No.II(2)/CTR/1036(b)/2018 at page 1 in Part II-Section 2 of the Tamil
Nadu Government Gazette Extraordinary No.403, dated 12th December, 2018.
#
Substituted, for the figures, letters and word ―31 March 2019‖ by Tamil Nadu
Goods and Services Tax ( Third Removal of difficulties) Order 2018 - G.O.(Ms)
No.158 , Commercial Taxes and Registration (B1) dated 31st Dec 2018 published
in Commercial Taxes and Registration Department Notification No.
II(2)/CTR/1099(e-2)/2018 at page 2 in Part II-Section 2 of the Tamil Nadu
Government Gazette Extraordinary No.425, dated 31st December, 2018
$
Substituted, for the figures, letters and word ―30th June 2019‖ , by Tamil Nadu
Goods and Services Tax ( Sixth Removal of difficulties) Order 2019 - G.O.(Ms)
No. 97 , Commercial Taxes and Registration (B1) dated 28thJune 2019, published in
Commercial Taxes and Registration Department Notification No. II(2)/CTR/498(c-
3)/2019 at page 2 in Part II-Section 2 of the Tamil Nadu Government Gazette
Extraordinary No.276, dated 28th June, 2019
%
Substituted, for the figures, letters and word ―31st August 2019‖, by
Tamil Nadu Goods and Services Tax (Seventh Removal of difficulties)
Order 2019 - G.O.(Ms) No 121 of Commercial Taxes and Registration (B1)
dated 27th August 2019, published in Commercial Taxes and Registration
Department Notification No. II(2)/CTR/691(a-1)/2019 at page 2 in Part II-
Section 2 of the Tamil Nadu Government Gazette Extraordinary No.343, dated
27th August, 2019.

60
Final Return 45. Every registered person who is required to furnish a
return under sub-section (1) of section 39 and whose registration
has been cancelled shall furnish a final return within three
months of the date of cancellation or date of order of
cancellation, whichever is later, in such form and manner as may
be prescribed.

Notice to return 46. Where a registered person fails to furnish a return under
defaulters.
section 39 or section 44 or section 45, a notice shall be issued
requiring him to furnish such return within fifteen days in such
form and manner as may be prescribed.

Levy of late fee. 47. (1) Any registered person who fails to furnish the details
of outward or inward supplies required under section 37 or
section 38 or returns required under section 39 or section 45 by
the due date shall pay a late fee of one hundred rupees for
everyday during which such failure continues subject to a
maximum amount of five thousand rupees.
(2) Any registered person who fails to furnish the return
required under section 44 by the due date shall be liable to pay a
late fee of one hundred rupees for every day during which such
failure continues subject to a maximum of an amount calculated
at a quarter per cent of his turnover in the State.

Goods and 48. (1) The manner of approval of goods and services tax
services tax
practitioners, their eligibility conditions, duties and obligations,
practitioners.
manner of removal and other conditions relevant for their
functioning shall be such as may be prescribed.

(2) A registered person may authorize an approved

goods and services tax practitioner to furnish the details of
outward supplies under section 37, the details of inward
supplies under section 38 and the return under section 39 or
1
section 44 or section 45 [and to perform such other functions] in
such manner as may be prescribed.

(3) Not withstanding anything contained in sub-section (2),

the responsibility for correctness of any particulars furnished in
the return or other details filed by the goods and services tax
practitioners shall continue to rest with the registered person on
whose behalf such return and details are furnished.

CHAPTER X.
PAYMENT OF TAX.
Payment of tax 49. (1) Every deposit made towards tax, interest, penalty, fee
Interest, penalty
and other or any other amount by a person by internet banking or by using
amounts. credit or debit cards or National Electronic Fund Transfer or Real
Time Gross Settlement or by such other mode and subject to such
conditions and restrictions as may be prescribed, shall be credited
to the electronic cash ledger of such person to be maintained in
such manner as may be prescribed.
------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019

61
 (2) The input tax credit as self-assessed in the return of a
registered person shall be credited to his electronic credit ledger,
1
in accordance with [section 41 or section 43 A] to be maintained
in such manner as may be prescribed.
(3) The amount available in the electronic cash ledger may be
used for making any payment towards tax, interest, penalty, fees or
any other amount payable under the provisions of this Act or the
rules made thereunder in such manner and subject to such
conditions and within such time as may be prescribed.

(4) The amount available in the electronic credit ledger may

be used for making any payment towards output tax under this
Act or under the Integrated Goods and Services Tax Act in such
manner and subject to such conditions and within such time as
may be prescribed.

(5) The amount of input tax credit available in the electronic

credit ledger of the registered person on account of—

(a) the Integrated tax shall first be utilised towards

payment of Integrated tax and the amount remaining, if any, may
be utilized towards payment of Central tax and State tax, or as
the case may be, Union territory tax, in that order;

(b) the Central tax shall first be utilised towards payment

of Central tax and the amount remaining, if any, may be utilised
towards payment of integrated tax;

(c) the State tax shall first be utilised towards payment

of State tax and the amount remaining, if any, may be utilised
towards payment of integrated tax;
2
[Provided that the input tax credit on account of State tax
shall be utilized towards payment of integrated tax only where the
balance of the input tax credit on account of central tax is not
available for payment of integrated tax.;]

(d) the Union territory tax shall first be utilised towards

payment of Union territory tax and the amount remaining, if any,
may be utilized towards payment of integrated tax;
3
[Provided that the input tax credit on account of Union
territory tax shall be utilised towards payment of integrated tax only
where the balance of the input tax credit on account of central tax is
not available for payment of integrated tax.]

(e) the Central tax shall not be utilised towards payment

of State tax or Union territory tax; and
(f) the State tax or Union territory tax shall not be utilized
towards payment of Central tax.
------------------------------------------------------------------------------------
1
Substituted for ―section 41‖ by TN Act 3 of 2019 dated 14.01.2019 [NOT YET
GIVEN EFFECT].
2
Inserted by TN Act 3 of 2019 dated 14.01. 2019 w..e.f 01.02.2019
3
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019

62
 (6) The balance in the electronic cash ledger or electronic
credit ledger after payment of tax, interest, penalty, fee or any
other amount payable under this Act or the rules made
thereunder may be refunded in accordance with the provisions of
section 54.

(7) All liabilities of a taxable person under this Act shall be

recorded and maintained in an electronic liability register in such
manner as may be prescribed.
(8) Every taxable person shall discharge his tax and other
dues under this Act or the rules made thereunder in the following
order, namely:—
(a) self-assessed tax, and other dues related to returns
of previous tax periods;
(b) self-assessed tax, and other dues related to the
return of the current tax period;
(c) any other amount payable under this Act or the rules
made thereunder Including the demand determined under
section73 or section 74.
(9) Every person who has paid the tax on goods or services
or both under this Act shall, unless the contrary is proved by him,
be deemed to have passed on the full incidence of such tax to the
recipient of such goods or services or both.
Explanation.— For the purposes of this section,-
(a) the date of credit to the account of the Government
in the authorized bank shall be deemed to be the date of deposit
in the electronic cash ledger.
(b) the expression,—
(i) ―tax dues‖ means the tax payable under this Act and
does not include interest, fee and penalty; and
(ii) ―other dues‖ means interest, penalty, fee or any other
amount payable under this Act or the rules made thereunder.
1
[(10) A registered person may, on the common portal,
transfer any amount of tax, interest, penalty, fee or any other
amount available in the electronic cash ledger under this act, to the
electronic cash ledger for integrated tax, central tax, state tax, or
cess, in such form and manner and subject to such conditions and
restrictions as may be prescribed and such transfer shall be
deemed to be a refund from the electronic cash ledger under this
Act.]
2
[(11) Where any amount has been transferred to the
electronic cash ledger under this act, the same shall be deemed to
be deposited in the said ledger as provided in sub-section (1).]
---------------------------------------------------------------------------------------
1
Inserted vide TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
2
Inserted vide TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

63
 1 Utilisation of input
Insertion of new [49A. Notwithstanding anything contained in section 49, the
sections 49 A tax credit
input tax credit on account of State tax shall be utilised towards subject to
and 49 B
payment of integrated tax or State tax, as the case may be only certain
conditions.
after the input tax credit available on account of integrated tax has
first been utilised fully towards such payment.

49B. Notwithstanding anything contained in this Chapter and Order of utilisation

of the input tax
subject to the provisions of clause (e) and clause (f) of sub section credit.
(5) of section 49, the Government may, on the recommendations of
the Council, prescribe the order and manner of utilisation of the
input tax credit on account of integrated tax, Central tax, State tax
or Union territory tax, as the case may be, towards payment of any
such tax.]

50. (1) Every person who is liable to pay tax in accordance Interest on
delayed
with the provisions of this Act or the rules made thereunder, but
payment of
fails to pay the tax or any part thereof to the Government within tax.
the period delayed prescribed, shall for the period for which the
tax or any part thereof remains unpaid, pay, on his own, payment
of tax interest at such rate, not exceeding eighteen per cent., as
may be notified by the Government on the recommendations of
the Council.
2
[Provided that the interest on tax payable in respect of
supplies made during a tax period and declared in the return for the
said period furnished after the due date in accordance with the
provisions of section 39, except where such return is furnished after
commencement of any proceedings under section 73 or section 74
in respect of the said period, shall be levied on that portion of the
tax that is paid by debiting the electronic cash ledger.]

(2) The interest under sub-section (1) shall be calculated,

in such manner as may be prescribed, from the day succeeding
the day on which such tax was due to be paid.

(3) A taxable person who makes an undue or excess claim

of input tax credit under sub-section (10) of section 42 or undue
or excess reduction in output tax liability under sub-section (10)
of section 43, shall pay interest on such undue or excess claim
or on such undue or excess reduction, as the case may be, at
such rate not exceeding twenty-four per cent., as may be notified
by the Government on the recommendations of the Council.

51. (1) Notwithstanding anything to the contrary contained in Tax deduction at

source.
this Act, the Government may mandate,—

(a) a department or establishment of the Central

Government or State Government; or

(b) local authority; or

---------------------------------------------------------------------------------------
1
Inserted vide TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019
2
Inserted vide TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.09.2020

64
 (c) Governmental agencies; or

(d) such persons or category of persons as may be

notified by the Government on the recommendations of the
Council,

(here after in this section referred to as ―the deductor‖), to

deduct tax at the rate of one per cent. from the payment made
or credited to the supplier (hereafter in this section referred to as
―the deductee‖) of taxable goods or services or both, where the
total value of such supply, under a contract, exceeds two lakh and
fifty thousand rupees:

Provided that no deduction shall be made if the location

of the supplier and the place of supply is in a State or Union
territory which is different from the State or, as the case may be,
Union territory of registration of the recipient.
Explanation.— For the purpose of deduction of tax
specified above, the value of supply shall be taken as the
amount excluding the Central tax, State tax, integrated tax and
cess indicated in the invoice.
(2) The amount deducted as tax under this section shall be
paid to the Government by the deductor within ten days after the
end of the month in which such deduction is made, in such
manner as may be prescribed.
1
[(3) A certificate of tax deduction at source shall be issued in
such form and in such manner as may be prescribed.]
2
(4) [Omitted.]
(5) The deductee shall claim credit, in his electronic cash
ledger, of the tax deducted and reflected in the return of the
deductor furnished under sub-section (3) of section 39, in such
manner as may be prescribed.
(6) If any deductor fails to pay to the Government the
amount deducted as tax under sub-section (1), he shall pay
interest in accordance with the provisions of sub-section (1) of
section 50, in addition to the amount of tax deducted.
(7) The determination of the amount in default under this
section shall be made in the manner specified in section 73 or
section 74.
---------------------------------------------------------------------------------------
1
Substituted by TN Act 29 of 2020 dated 19.10.2020, w.e.f 01.01.2021
Prior to the substitution, sub-section (3) of Section 51, read as under:
―(3) The deductor shall furnish to the deductee a certificate mentioning therein the
contract value, rate of deduction, amount deducted, amount paid to the
Government and such other particulars in such manner as may be prescribed.‖
2
Omiited by TN Act 29 of 2020 dated 19.10.2020, w.e.f 01.01.2021
Prior to the omission, sub-section (4) of Section 51, read as under:

―(4) If any deductor fails to furnish to the deductee the certificate, after
deducting the tax at source, within five days of crediting the amount so deducted
to the Government, the deductor shall pay, by way of a late fee, a sum of one
hundred rupees per day from the day after the expiry of such five day period until
the failure is rectified, subject to a maximum amount of five thousand rupees ―.

65
 (8) The refund to the deductor or the deductee arising on
account of excess or erroneous deduction shall be dealt with in
accordance with the provisions of section 54:
Provided that no refund to the deductor shall be granted, if the
amount deducted has been credited to the electronic cash ledger of
the deductee.
52. (1) Notwithstanding anything to the contrary contained in Collection of tax
this Act, every electronic commerce operator (hereafter in this at source
section referred to as the ―operator‖), not being an agent,
shall collect an amount calculated at such rate not exceeding
one per cent. as may be notified by the Government on the
recommendations of the Council, of the net value of taxable
supplies made through it by other suppliers where the
consideration with respect to such supplies is to be collected by
the operator.
Explanation.— For the purposes of this sub-section, the
expression ―net value of taxable supplies‖ shall mean the
aggregate value of taxable supplies of goods or services or both,
other than services notified under sub-section (5) of section 9,
made during any month by all registered persons through the
operator reduced by the aggregate value of taxable supplies
returned to the suppliers during the said month.
(2) The power to collect the amount specified in sub-
section (1) shall be without prejudice to any other mode of
recovery from the operator.
(3) The amount collected under sub-section (1) shall be
paid to the Government by the operator within ten days after the
end of the month in which such collection is made, in such
manner as may be prescribed.
(4) Every operator who collects the amount specified in
sub-section (1) shall furnish a statement, electronically,
containing the details of outward supplies of goods or services or
both effected through it, including the supplies of goods or
services or both returned through it, and the amount collected
under sub-section (1) during a month, in such form and manner
as may be prescribed, within ten days after the end of such
month.
1
[Explanation: - For the purposes of this sub-section, it is
hereby declared that the due date for furnishing the said statement
for the months of October, November and December, 2018 shall be
2 2 1
the [07th February 2019.] ]
----------------------------------------------------------------------------------------
1
Inserted by Tamil Nadu Goods and Services Tax (Fourth Removal of
Difficulties) Order, 2018 - G.O.Ms. No. 159, Commercial Taxes and Registration
(B1), Dated 31st December 2018, published in Commercial Taxes and
Registration Department Notification No. II(2)/CTR/1099(e-3)/2018 at page 2-3 in
Part II-Section 2 of the Tamil Nadu Government Gazette Extraordinary No.425,
dated 31st December, 2018.
2
Substituted for ―31st January, 2019‖, by Tamil Nadu Goods and Services Tax
(Second Removal of Difficulties) Order, 2019 - G.O.Ms.No. 22, Commercial
Taxes and Registration (B1), Dated 1st February 2019, published in Commercial
Taxes and Registration Department Notification No. II(2)/CTR/117(d-3)/2019 at
page 2-3 in Part II-Section 2 of the Tamil Nadu Government Gazette Extraordinary
No.42, dated 1st February, 2019.

66
 1
[Provided that the commissioner may, for reasons to be
recorded in writing, by notification, extend the time limit for
furnishing the statement for such class of registered persons as
may be specified therein:
Provided further that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.;]
(5) Every operator who collects the amount specified in sub-
section (1) shall furnish an annual statement, electronically,
containing the details of outward supplies of goods or services
or both effected through it, including the supplies of goods or
services or both returned through it, and the amount collected
under the said sub-section during the financial year, in such form
and manner as may be prescribed, before the thirty first day of
December following the end of such financial year.
2
[Provided that the commissioner may, on the
recommendations of the council and for reasons to be recorded in
writing, by notification, extend the time limit for furnishing the
annual statement for such class of registered persons as may be
specified therein:
Provided further that any extension of time limit notified by the
Commissioner of Central tax shall be deemed to be notified by the
Commissioner.]
(6) If any operator after furnishing a statement under sub-
section discovers any omission or incorrect particulars therein,
other than as a result of scrutiny, audit, inspection or enforcement
activity by the tax authorities, he shall rectify such omission or
incorrect particulars in the statement to be furnished for the
month during which such omission or incorrect particulars are
noticed, subject to payment of interest, as specified in sub-
section (1) of section 50:
Provided that no such rectification of any omission or
incorrect particulars shall be allowed after the due date for
furnishing of statement for the month of September following the
end of the financial year or the actual date of furnishing of the
relevant annual statement, whichever is earlier.
(7) The supplier who has supplied the goods or services or
both through the operator shall claim credit, in his electronic cash
ledger, of the amount collected and reflected in the statement of
the operator furnished under sub-section (4), in such manner as
may be prescribed.
(8) The details of supplies furnished by every operator
under sub- section (4) shall be matched with the corresponding
details of outward supplies furnished by the concerned supplier
registered under this Act in such manner and within such time as
may be prescribed.
----------------------------------------------------------------------------------------
1
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020
2
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

67
 (9) Where the details of outward supplies furnished by the
operator under sub-section (4) do not match with the
2
corresponding details furnished by the supplier under [section 37
or section 39] the discrepancy shall be communicated to both
persons in such manner and within such time as may be
prescribed.

(10) The amount in respect of which any discrepancy is

communicated under sub-section (9) and which is not rectified by
the supplier in his valid return or the operator in his statement
for the month in which discrepancy is communicated, shall be
added to the output tax liability of the said supplier, where the
value of outward supplies furnished by the operator is more than
the value of outward supplies furnished by the supplier, in his
return for the month succeeding the month in which the
discrepancy is communicated in such manner as may be
prescribed.

(11) The concerned supplier, in whose output tax liability any

amount has been added under sub-section (10), shall pay the tax
payable in respect of such supply along with interest, at the rate
specified under sub-section (1) of section 50 on the amount so
added from the date such tax was due till the date of its
payment.

(12) Any authority not below the rank of Deputy

Commissioner may serve a notice, either before or during the
course of any proceedings under this Act, requiring the operator
to furnish such details relating to—

(a) supplies of goods or services or both effected

through such operator during any period; or

(b) stock of goods held by the suppliers making supplies

through such operator in the godowns or warehouses, by
whatever name called, managed by such operator and declared
as additional places of business by such suppliers, as may be
specified in the notice.

(13) Every operator on whom a notice has been served

under sub- section (12) shall furnish the required information
within fifteen working days of the date of service of such notice.

(14) Any person who fails to furnish the information required

by the notice served under sub-section (12) shall, without
prejudice to any action that may be taken under section 122, be
liable to a penalty which may extend to twenty-five thousand
rupees.

Explanation.— For the purposes of this section, the

expression ―concerned supplier‖ shall mean the supplier of goods
or services or both making supplies through the operator.
---------------------------------------------------------------------------------------
2
Substituted, for ‖ section 37‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019

68
Transfer of input 53. On utilization of input tax credit availed under this Act for
tax credit.
payment of tax dues under the Integrated Goods and Services
Tax Act in accordance with the provisions of sub-section (5) of
section 49, as reflected in the valid return furnished under sub-
section (1) of section 39, the amount collected as State tax shall
stand reduced by an amount equal to such credit so utilized and
the State Government shall transfer an amount equal to the
amount so reduced from the State tax account to the integrated
tax account in such manner and within such time as may be
prescribed.
1 1
[Transfer of certain [53A. Where any amount has been transferred from the Insertion of new
amounts.] section 53A
electronic cash ledger under this act to the electronic cash ledger
under the Central Goods and Services Tax Act or under the
Integrated Goods and Services Tax Act or under the Goods and
Services Tax (Compensation to States) Act, the Government shall,
transfer to the central tax account or integrated tax account or cess
account, an amount equal to the amount transferred from the
electronic cash ledger, in such manner and within such time as may
be prescribed.]

CHAPTER XI.
REFUNDS.

Refund of tax. 54. (1) Any person claiming refund of any tax and interest, If
any, paid on such tax or any other amount paid by him, may
make an application before the expiry of two years from the
relevant date in such form and manner as may be prescribed:

Provided that a registered person, claiming refund of any

balance in the electronic cash ledger in accordance with the
provisions of sub-section (6) of section 49, may claim such
refund in the return furnished under section 39 in such manner
as may be prescribed.

(2) A specialized agency of the United Nations

Organization or any Multilateral Financial Institution and
Organization notified under the United Nations (Privileges and
Immunities) Act, 1947, Consulate or Embassy of foreign
countries or any other person or class of persons, as notified
under section 55, entitled to a refund of tax paid by it on inward
supplies of goods or services or both, may make an application
for such refund, in such form and manner as may be prescribed,
before the expiry of six months from the last day of the quarter in
which such supply was received.

(3) Subject to the provisions of sub-section (10), a

registered person may claim refund of any unutilized input tax
credit at the end of any tax period:

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1
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f 01.01.2020

69
 Provided that no refund of unutilised input tax credit shall
be allowed in cases other than—

(i) zero-rated supplies made without payment of tax;

(ii) where the credit has accumulated on account of rate
of tax on inputs being higher than the rate of tax on output
supplies (other than nil rated or fully exempt supplies), except
supplies of goods or services or both as may be notified by
the Government on the recommendations of the Council:
Provided further that no refund of unutilised input tax credit
shall be allowed in cases where the goods exported out of India
are subjected to export duty:

Provided also that no refund of input tax credit shall be

allowed, if the supplier of goods or services or both claims
refund of the integrated tax paid on such supplies.

(4) The application shall be accompanied by—

(a) such documentary evidence as may be prescribed to
establish that a refund is due to the applicant; and
(b) such documentary or other evidence (including the
documents referred to in section 33) as the applicant may furnish
to establish that the amount of tax and interest, if any, paid on
such tax or any other amount paid in relation to which such
refund is claimed was collected from, or paid by, him and the
incidence of such tax and interest had not been passed on to any
other person:

Provided that where the amount claimed as refund is less

than two lakh rupees, it shall not be necessary for the applicant
to furnish any documentary and other evidences but he may file
a declaration, based on the documentary or other evidences
available with him, certifying that the incidence of such tax and
interest had not been passed on to any other person.
(5) If, on receipt of any such application, the proper officer
is satisfied that the whole or part of the amount claimed as
refund is refundable, he may make an order accordingly and the
amount so determined shall be credited to the Fund referred to
in section 57.

(6) Notwithstanding anything contained in sub-section (5),

the proper officer may, in the case of any claim for refund on
account of zero-rated supply of goods or services or both made
by registered persons, other than such category of registered
persons as may be notified by the Government on the
recommendations of the Council, refund on a provisional basis,
ninety per cent. of the total amount so claimed, excluding the
amount of input tax credit provisionally accepted, in such
manner and subject to such conditions, limitations and
safeguards as may be prescribed and thereafter make an order
under sub- section (5) for final settlement of the refund claim
after due verification of documents furnished by the applicant.

70
 (7) The proper officer shall issue the order under sub-
section (5) within sixty days from the date of receipt of
application complete in all respects.

(8) Notwithstanding anything contained in sub-section

(5), the refundable amount shall, instead of being credited to
the Fund, be paid to the applicant, if such amount is relatable
to—
1
(a) refund of tax paid [on export] of goods or services
2
or both or on inputs or input services used in making [such
exports]

(b) refund of unutilized input tax credit under sub-

section(3);

(c) refund of tax paid on a supply which is not provided,

either wholly or partially, and for which invoice has not been
issued, or where a refund voucher has been issued;

(d) refund of tax in pursuance of section 77;

(e) the tax and interest, if any, or any other amount

paid by the applicant, if he had not passed on the incidence
of such tax and interest to any other person; or

(f) the tax or interest borne by such other class of

applicants as the Government may, on the recommendations of
the Council, by notification, specify.
3
[(8-A) Where the Central Government has disbursed
the refund of State tax, the Government shall transfer an
amount equal to the amount so refunded, to the Central
Government.].

(9) Notwithstanding anything to the contrary contained in

any judgment, decree, order or direction of the Appellate
Tribunal or any court or in any other provisions of this Act or the
rules made thereunder or in any other law for the time being in
force, no refund shall be made except in accordance with the
provisions of sub-section (8).

(10) Where any refund is due under sub-section (3) to a

registered person who has defaulted in furnishing any return or
who is required to pay any tax, interest or penalty, which has
not been stayed by any court, Tribunal or Appellate Authority by
the specified date, the proper officer may—

(a) withhold payment of refund due until the said person

has furnished the return or paid the tax, interest or penalty, as
the case may be;
----------------------------------------------------------------------- -------------
1
Substituted, for ―on zero-rated supplies‖., by TN Act 3 of 2019 dated
14.01.2019 w.e.f 01.02.2019
2
Substituted, for ―such zero-rated supplies‖., by TN Act 3 of 2019 dated
14.01.2019 w.e.f 01.02.2019
3
Inserted by TN Act 10 of 2020 dated 15.02.2020 w.e.f. 01.09.2019.

71
 (b) deduct from the refund due, any tax, interest,
penalty, fee or any other amount which the taxable person is
liable to pay but which remains unpaid under this Act or under the
existing law.
Explanation.— For the purposes of this sub-section, the
expression ―specified date‖ shall mean the last date for filing an
appeal under this Act.
(11) Where an order giving rise to a refund is the subject
matter of an appeal or further proceedings or where any other
proceedings under this Act is pending and the Commissioner is of
the opinion that grant of such refund is likely to adversely affect
the revenue in the said appeal or other proceedings on account of
malfeasance or fraud committed, he may, after giving the taxable
person an opportunity of being heard, withhold the refund till such
time as he may determine.

(12) Where a refund is withheld under sub-section (11), the

taxable person shall, notwithstanding anything contained in
section 56, be entitled to interest at such rate not exceeding six
per cent. as may be notified on the recommendations of the
Council, if as a result of the appeal or further proceedings he
becomes entitled to refund.
(13) Notwithstanding anything to the contrary contained in
this section, the amount of advance tax deposited by a casual
taxable person or a non- resident taxable person under sub-
section (2) of section 27, shall not be refunded unless such
person has, in respect of the entire period for which the certificate
of registration granted to him had remained in force, furnished all
the returns required under section 39.

(14) Notwithstanding anything contained in this section, no

refund under sub-section (5) or sub-section (6) shall be paid to an
applicant, if the amount is less than one thousand rupees.

Explanation.— For the purposes of this section,—

(1) ―refund‖ includes refund of tax paid on zero-rated
supplies of goods or services or both or on inputs or input
services used in making such zero-rated supplies, or refund of
tax on the supply of goods regarded as deemed exports, or
refund of unutilised input tax credit as provided under sub-section
(3).
(2) ―relevant date‖ means—
(a) in the case of goods exported out of India where a
refund of tax paid is available in respect of goods themselves
or, as the case may be, the inputs or input services used in
such goods,—

(i) if the goods are exported by sea or air, the

date on which the ship or the aircraft in which such goods are
loaded, leaves India; or

72
 (ii) if the goods are exported by land, the date on
which such goods pass the frontier; or

(iii) if the goods are exported by post, the date

of despatch of goods by the Post Office concerned to a place
outside India;
(b) in the case of supply of goods regarded as
deemed exports where a refund of tax paid is available in respect
of the goods, the date on which the return relating to such
deemed exports is furnished;

(c) in the case of services exported out of India where

a refund of tax paid is available in respect of services themselves
or, as the case may be, the inputs or input services used in such
services, the date of—

(i) receipt of payment in convertible foreign

1
exchange, [or in Indian rupees wherever permitted by the Reserve
Bank of India] where the supply of services had been completed
prior to the receipt of such payment; or
(ii) issue of invoice, where payment for the
services had been received in advance prior to the date of issue of
the invoice;
(d) in case where the tax becomes refundable as a
consequence of judgment, decree, order or direction of the
Appellate Authority, Appellate Tribunal or any court, the date of
communication of such judgment, decree, order or direction;
2
[(e) in the case of refund of unutilised input tax credit
under clause (ii) of the first proviso to sub-section (3), the due date
for furnishing of return under section 39 for the period in which such
claim for refund arises;]

f) in the case where tax is paid provisionally under

this Act or the rules made thereunder, the date of adjustment of
tax after the final assessment thereof;

(g) in the case of a person, other than the supplier,

the date of receipt of goods or services or both by such person;
and
(h) in any other case, the date of payment of tax.

Refund in certain 55. The Government may, on the recommendations of the

cases Council, by notification, specify any specialized agency of the
United Nations Organization or any Multilateral Financial
Institution and Organization notified under the United Nations Central Act 46 of
1947
(Privileges and Immunities) Act, 1947, Consulate or Embassy of
-----------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
2
Substituted by TN Act 3 of 2019 dated 14.01. 2019 w.e.f 01.02.2019
Prior to the substitution, sub clause (e) of clause (2) to Explanation of Section
54, read as under:
―(e) in the case of refund of unutilised input tax credit under sub-section (3), the
end of the financial year in which such claim for refund arises;‖

73
foreign countries and any other person or class of persons as
may be specified in this behalf, who shall, subject to such
conditions and restrictions as may be prescribed, be entitled to
claim a refund of taxes paid on the notified supplies of goods or
services or both received by them.

56. If any tax ordered to be refunded under sub-section (5) Interest on

delayed
of section 54 to any applicant is not refunded within sixty days
refunds.
from the date of receipt of application under sub-section (1) of
that section, interest at such rate not exceeding six per cent. as
may be specified in the notification issued by the Government on
the recommendations of the Council shall be payable in respect
of such refund from the date immediately after the expiry of
sixty days from the date of receipt of application under the said
sub-section till the date of refund of such tax:

Provided that where any claim of refund arises from an order

passed by an adjudicating authority or Appellate Authority or
Appellate Tribunal or court which has attained finality and the
same is not refunded within sixty days from the date of receipt of
application filed consequent to such order, interest at such rate
not exceeding nine per cent. as may be notified by the
Government on the recommendations of the Council shall be
payable in respect of such refund from the date immediately after
the expiry of sixty days from the date of receipt of application till
the date of refund.

Explanation.— For the purposes of this section, where any

order of refund is made by an Appellate Authority, Appellate
Tribunal or any court against an order of the proper officer under
sub-section (5) of section 54, the order passed by the Appellate
Authority, Appellate Tribunal or by the court shall be deemed
to be an order passed under the said sub-section (5).

57. The Government shall constitute a Fund, to be called Consumer

Welfare Fund.
the Consumer Welfare Fund and there shall be credited to the
Fund,—
(a) the amount referred to in sub-section (5) of section 54;
(b) any income from investment of the amount credited to
the Fund; and
(c) such other monies received by it,
in such manner as may be prescribed.

58. (1) All sums credited to the Fund shall be utilized by the Utilisation of
Fund.
Government for the welfare of the consumers in such manner as
may be prescribed.
(2) The Government or the authority specified by it shall
maintain proper and separate account and other relevant
records in relation to the Fund and prepare an annual statement
of accounts in such form as may be prescribed in consultation
with the Comptroller and Auditor General of India.

74
 CHAPTER XII.
ASSESSMENT.

Self-assessment. 59. Every registered person shall self-assess the taxes

payable under this Act and furnish a return for each tax
period as specified under section 39.

Provisional 60. (1) Subject to the provisions of sub-section (2), where

assessment.
the taxable person is unable to determine the value of goods or
services or both or determine the rate of tax applicable thereto, he
may request the proper officer in writing giving reasons for
payment of tax on a provisional basis and the proper officer shall
pass an order, within a period not later than ninety days from the
date of receipt of such request, allowing payment of tax on
provisional basis at such rate or on such value as may be
specified by him.

(2) The payment of tax on provisional basis may be allowed,

if the taxable person executes a bond in such form as may be
prescribed, and with such surety or security as the proper officer
may deem fit, binding the taxable person for payment of the
difference between the amount of tax as may be finally assessed
and the amount of tax provisionally assessed.

(3) The proper officer shall, within a period not exceeding six
months from the date of the communication of the order issued
under sub-section (1), pass the final assessment order after
taking into account such information as may be required for
finalizing the assessment:

Provided that the period specified in this sub-section may,

on sufficient cause being shown and for reasons to be recorded
in writing, be extended by the Joint Commissioner or Additional
Commissioner for a further period not exceeding six months and
by the Commissioner for such further period not exceeding four
years.

(4) The registered person shall be liable to pay interest on

any tax payable on the supply of goods or services or both under
provisional assessment but not paid on the due date specified
under sub-section (7) of section 39 or the rules made thereunder,
at the rate specified under sub-section (1) of section 50, from the
first day after the due date of payment of tax in respect of the
said supply of goods or services or both till the date of actual
payment, whether such amount is paid before or after the
issuance of order for final assessment.

(5) Where the registered person is entitled to a refund

consequent to the order of final assessment under sub-section
(3), subject to the provisions of sub-section (8) of section 54,
interest shall be paid on such refund as provided in section 56.

75
 61. (1) The proper officer may scrutinize the return and related Scrutiny of
returns.
particulars furnished by the registered person to verify the
correctness of the return and inform him of the discrepancies
noticed, if any, in such manner as may be prescribed and seek
his explanation thereto.

(2) In case the explanation is found acceptable, the

registered person shall be informed accordingly and no further
action shall be taken in this regard.

(3) In case no satisfactory explanation is furnished within a

period of thirty days of being informed by the proper officer or
such further period as may be permitted by him or where the
registered person, after accepting the discrepancies, fails to take
the corrective measure in his return for the month in which the
discrepancy is accepted, the proper officer may initiate
appropriate action including those under section 65 or section 66
or section 67, or proceed to determine the tax and other dues
under section 73 or section 74.

62. (1) Notwithstanding anything to the contrary contained in Assessment of

non-filers of
section 73 or section 74, where a registered person fails to furnish returns.
the return under section 39 or section 45, even after the service of
a notice under section 46, the proper officer may proceed to
assess the tax liability of the said person to the best of his
judgment taking into account all the relevant material which is
available or which he has gathered and issue an assessment
order within a period of five years from the date specified under
section 44 for furnishing of the annual return for the financial
year to which the tax not paid relates.

(2) Where the registered person furnishes a valid return

within thirty days of the service of the assessment order under
sub-section (1), the said assessment order shall be deemed to
have been withdrawn but the liability for payment of interest
under sub-section (1) of section 50 or for payment of late fee
under section 47 shall continue.

63. Notwithstanding anything to the contrary contained in Assessment of

unregistered
section 73 or section 74, where a taxable person fails to obtain persons.
registration even though liable to do so or whose registration has
been cancelled under sub-section (2) of section 29 but who was
liable to pay tax, the proper officer may proceed to assess the
tax liability of such taxable person to the best of his judgment for
the relevant tax periods and issue an assessment order within a
period of five years from the date specified under section 44 for
furnishing of the annual return for the financial year to which the
tax not paid relates:

Provided that no such assessment order shall be passed

without giving the person an opportunity of being heard.

76
Summary 64. (1) The proper officer may, on any evidence showing a
assessment in
certain special
tax liability of a person coming to his notice, with the previous
cases. permission of Additional Commissioner or Joint Commissioner,
proceed to assess the tax liability of such person to protect the
interest of revenue and issue an assessment order, if he has
sufficient grounds to believe that any delay in doing so may
adversely affect the interest of revenue:

Provided that where the taxable person to whom the

liability pertains is not ascertainable and such liability pertains to
supply of goods, the person in charge of such goods shall be
deemed to be the taxable person liable to be assessed and
liable to pay tax and any other amount due under this section.

(2) On an application made by the taxable person within thirty

days from the date of receipt of order passed under sub-section (1)
or on his own motion, if the Additional Commissioner or Joint
Commissioner considers that such order is erroneous, he may
withdraw such order and follow the procedure laid down in section
73 or section 74.

CHAPTER XIII.
AUDIT.

Audit by tax 65. (1) The Commissioner or any officer authorized by him,
authorities.
by way of a general or a specific order, may undertake audit of
any registered person for such period, at such frequency and in
such manner as may be prescribed.

(2) The officers referred to in sub-section (1) may conduct

audit at the place of business of the registered person or in their
office.
(3) The registered person shall be informed by way of a
notice not less than fifteen working days prior to the conduct of
audit in such manner as may be prescribed.
(4) The audit under sub-section (1) shall be completed within
a period of three months from the date of commencement of the
audit:
Provided that where the Commissioner is satisfied that
audit in respect of such registered person cannot be completed
within three months, he may, for the reasons to be recorded in
writing, extend the period by a further period not exceeding six
months.
Explanation.— For the purposes of this sub-section, the
expression ―commencement of audit‖ shall mean the date on
which the records and other documents, called for by the tax
authorities, are made available by the registered person or the
actual institution of audit at the place of business, whichever is
later.

77
 (5) During the course of audit, the authorised officer may
require the registered person-

(i) to afford him the necessary facility to verify the books

of account or other documents as he may require;

(ii) to furnish such information as he may require and

render assistance for timely completion of the audit.

(6) On conclusion of audit, the proper officer shall, within

thirty days, inform the registered person, whose records are
audited, about the findings, his rights and obligations and the
reasons for such findings.

(7) Where the audit conducted under sub-section (1)

results in detection of tax not paid or short paid or erroneously
refunded, or input tax credit wrongly availed or utilised, the proper
officer may initiate action under section 73 or section 74.

66. (1) If at any stage of scrutiny, inquiry, investigation or Special audit.

any other proceedings before him, any officer not below the rank of
Assistant Commissioner, having regard to the nature and
complexity of the case and the interest of revenue, is of the
opinion that the value has not been correctly declared or the
credit availed is not within the normal limits, he may, with the
prior approval of the Commissioner, direct such registered
person by a communication in writing to get his records including
books of account examined and audited by a chartered
accountant or a cost accountant as may be nominated by the
Commissioner.

(2) The chartered accountant or cost accountant so

nominated shall, within the period of ninety days, submit a
report of such audit duly signed and certified by him to the said
Assistant Commissioner mentioning therein such other
particulars as may be specified:

Provided that the Assistant Commissioner may, on an

application made to him in this behalf by the registered person or
the chartered accountant or cost accountant or for any material
and sufficient reason, extend the said period by a further period
of ninety days.

(3) The provisions of sub-section (1) shall have effect

notwithstanding that the accounts of the registered person have
been audited under any other provisions of this Act or any other
law for the time being in force.

(4) The registered person shall be given an opportunity of

being heard in respect of any material gathered on the basis of
special audit under sub- section (1) which is proposed to be used
in any proceedings against him under this Act or the rules made
thereunder.

78
 (5) The expenses of the examination and audit of records
under sub-section (1), including the remuneration of such
chartered accountant or cost accountant, shall be determined
and paid by the Commissioner and such determination shall be
final.

(6) Where the special audit conducted under sub-section

(1) results in detection of tax not paid or short paid or
erroneously refunded, or input tax credit wrongly availed or
utilised, the proper officer may initiate action under section 73 or
section 74.

CHAPTER XIV.
INSPECTION, SEARCH, SEIZURE AND ARREST.

Power of inspection 67. (1) Where the proper officer, not below the rank of Joint
search and Commissioner, has reasons to believe that–
seizure.
(a) a taxable person has suppressed any
transaction relating to supply of goods or services or both or the
stock of goods in hand, or has claimed input tax credit in excess
of his entitlement under this Act or has indulged in contravention
of any of the provisions of this Act or the rules made thereunder
to evade tax under this Act; or
(b) any person engaged in the business of
transporting goods or an owner or operator of a warehouse or a
godown or any other place is keeping goods which have escaped
payment of tax or has kept his accounts or goods in such a
manner as is likely to cause evasion of tax payable under this
Act,

he may authorise in writing any other officer of State tax to

inspect any places of business of the taxable person or the
persons engaged in the business of transporting goods or the
owner or the operator of warehouse or godown or any other
place.
(2) Where the proper officer, not below the rank of Joint
Commissioner, either pursuant to an inspection carried out under
sub-section (1) or otherwise, has reasons to believe that any
goods liable to confiscation or any documents or books or things,
which in his opinion shall be useful for or relevant to any
proceedings under this Act, are secreted in any place, he may
authorise in writing any other officer of State tax to search and
seize or may himself search and seize such goods, documents
or books or things:
Provided that where it is not practicable to seize any such
goods, the proper officer, or any officer authorized by him, may
serve on the owner or the custodian of the goods an order that
he shall not remove, part with, or otherwise deal with the goods
except with the previous permission of such officer:

79
 Provided further that the documents or books or things so
seized shall be retained by such officer only for so long as may
be necessary for their examination and for any inquiry or
proceedings under this Act.

(3) The documents, books or things referred to in sub-

section (2) or any other documents, books or things produced
by a taxable person or any other person, which have not been
relied upon for the issue of notice under this Act or the rules
made thereunder, shall be returned to such person within a
period not exceeding thirty days of the issue of the said notice.

(4) The officer authorized under sub-section (2) shall have

the power to seal or break open the door of any premises or to
break open any almirah, electronic devices, box, receptacle in
which any goods, accounts, registers or documents of the
person are suspected to be concealed, where access to
such premises, almirah, electronic devices, box or receptacle is
denied.

(5) The person from whose custody any documents are

seized under sub-section (2) shall be entitled to make copies
thereof or take extracts therefrom in the presence of an
authorised officer at such place and time as such officer m ay
indicate in this behalf except where making such copies or
taking such extracts may, in the opinion of the proper officer,
prejudicially affect the investigation.

(6) The goods so seized under sub-section (2) shall be

released, on a provisional basis, upon execution of a bond and
furnishing of a security, in such manner and of such quantum,
respectively, as may be prescribed or on payment of applicable
tax, interest and penalty payable, as the case may be.

(7) Where any goods are seized under sub-section (2) and
no notice in respect thereof is given within six months of the
seizure of the goods, the goods shall be returned to the person
from whose possession they were seized:
Provided that the period of six months may, on sufficient
cause being shown, be extended by the proper officer for a
further period not exceeding six months.
(8) The Government may, having regard to the perishable
or hazardous nature of any goods, depreciation in the value of
the goods with the passage of time, constraints of storage space
for the goods or any other relevant considerations, by
notification, specify the goods or class of goods which shall, as
soon as may be after its seizure under sub-section (2), be
disposed of by the proper officer in such manner as may be
prescribed.
(9) Where any goods, being goods specified under sub-
section (8), have been seized by a proper officer, or any officer
authorised by him under sub-section (2), he shall prepare an
inventory of such goods in such manner as may be prescribed.

80
 (10) The provisions of the Code of Criminal Procedure, Central Act 2 of
1974.
1973, relating to search and seizure, shall, so far as may be,
apply to search and seizure under this section subject to the
modification that sub-section (5) of section 165 of the said
Code shall have effect as if for the word ―Magistrate‖, wherever it
occurs, the word ―Commissioner‖ were substituted.

(11) Where the proper officer has reasons to believe that

any person has evaded or is attempting to evade the payment of
any tax, he may, for reasons to be recorded in writing, seize the
accounts, registers or documents of such person produced
before him and shall grant a receipt for the same, and shall
retain the same for so long as may be necessary in connection
with any proceedings under this Act or the rules made
thereunder for prosecution.

(12) The Commissioner or an officer authorized by him may

cause purchase of any goods or services or both by any person
authorized by him from the business premises of any taxable
person, to check the issue of tax invoices or bills of supply by
such taxable person, and on return of goods so purchased
by such officer, such taxable person or any person in charge
of the business premises shall refund the amount so paid
towards the goods after cancelling any tax invoice or bill of
supply issued earlier.

Inspection of goods 68. (1) The Government may require the person in charge of
in movement. a conveyance carrying any consignment of goods of value
exceeding such amount as may be specified to carry with him
such documents and such devices as may be prescribed.

(2) The details of documents required to be carried under

sub-section (1) shall be validated in such manner as may be
prescribed.

(3) Where any conveyance referred to in sub-section (1) is

intercepted by the proper officer at any place, he may require the
person-in-charge of the said conveyance to produce the
documents prescribed under the said sub- section and devices
for verification and the said person shall be liable to produce the
documents and devices and also allow the inspection of goods.

Power to arrest.
69. (1) Where the Commissioner has reasons to believe that
a person has committed any offence specified in clause (a) or
clause (b) or clause (c) or clause(d) of sub-section (1) of section
132 which is punishable under clause (i) or (ii) of sub-section (1),
or sub-section (2) of the said section, he may, by order,
authorize any officer of State tax to arrest such person.
(2) Where a person is arrested under sub-section (1) for an
offence specified under sub-section (5) of section 132, the officer
authorized to arrest the person shall inform such person of the
grounds of arrest and produce him before a Magistrate within
twenty four hours.

81
Central Act 2 of (3) Subject to the provisions of the Code of Criminal
1973 Procedure, 1973,—
(a) where a person is arrested under sub-section (1) for
any offence specified under sub-section (4) of section 132, he
shall be admitted to bail or in default of bail, forwarded to the
custody of the Magistrate;
(b) in the case of a non-cognizable and bailable offence,
the Deputy Commissioner or the Assistant Commissioner shall,
for the purpose of releasing an arrested person on bail or
otherwise, have the same powers and be subject to the same
provisions as an officer-in-charge of a police station.

70. (1) The proper officer under this Act shall have power to Power to summon
summon any person whose attendance he considers necessary persons to
give evidence
either to give evidence or to produce a document or any other and produce
thing in any inquiry in the same manner, as provided in the case documents
Central Act 5 of
1908
of a civil court under the provisions of the Code of Civil
Procedure, 1908.
(2) Every such inquiry referred to in sub-section (1) shall be
Central Act 45 of
1860 deemed to be a ―judicial proceedings‖ within the meaning of section
193 and section 228 of the Indian Penal Code.

71. (1) Any officer under this Act, authorized by the proper Access to
business
officer not below the rank of Joint Commissioner, shall have
premises.
access to any place of business of a registered person to inspect
books of account, documents, computers, computer programs,
computer software whether installed in a computer or otherwise
and such other things as he may require and which may be
available at such place, for the purposes of carrying out any
audit, scrutiny, verification and checks as may be necessary to
safeguard the interest of revenue.
(2) Every person in charge of place referred to in sub-section
(1) shall, on demand, make available to the officer authorized under
sub-section (1) or the audit party deputed by the proper officer or
a cost accountant or chartered accountant nominated under
section 66—
(i) such records as prepared or maintained by the
registered person and declared to the proper officer in such
manner as may be prescribed;
(ii) trial balance or its equivalent;
(iii) statements of annual financial accounts, duly audited,
wherever required;

Central Act 18 of (iv) cost audit report, if any, under section 148 of the
2013. Companies Act, 2013;

Central Act 43 (v) the income-tax audit report, if any, under section
of 1961
44AB of the Income-tax Act, 1961;and
(vi) any other relevant record,

for the scrutiny by the officer or audit party or the chartered

accountant or cost accountant within a period not exceeding

82
 fifteen working days from the day when such demand is made, or
such further period as may be allowed by the said officer or the
audit party or the chartered accountant or cost accountant.
Officers to assist 72. (1) All officers of Police, Railways, Customs, and those
proper Officers.
officers engaged in the collection of land revenue, including
village officers, officers of Central tax and officers of the Union
territory tax shall assist the proper officers in the implementation
of this Act.
(2) The Government may, by notification, empower and
require any other class of officers to assist the proper officers in
the implementation of this Act when called upon to do so by the
Commissioner.

CHAPTER XV.
DEMANDS AND RECOVERY.

Determination of 73. (1) Where it appears to the proper officer that any tax
tax not paid or
has not been paid or short paid or erroneously refunded, or
short paid or
erroneously where input tax credit has been wrongly availed or utilised for
refunded or any reason, other than the reason of fraud or any wilful
input tax credit
wrongly availed misstatement or suppression of facts to evade tax, he shall
or utilised for serve notice on the person chargeable with tax which has not
any reason
other than been so paid or which has been so short paid or to whom the
fraud or any refund has erroneously been made, or who has wrongly availed
wilful
misstatement
or utilised input tax credit, requiring him to show cause as to why
or suppression he should not pay the amount specified in the notice along with
of facts. interest payable thereon under section 50 and a penalty
leviable under the provisions of this Act or the rules made
thereunder.
(2) The proper officer shall issue the notice under sub-
section (1) at least three months prior to the time limit specified
in sub-section (10) for issuance of order.

(3) Where a notice has been issued for any period under
sub-section (1), the proper officer may serve a statement,
containing the details of tax not paid or short paid or
erroneously refunded or input tax credit wrongly availed or
utilised for such periods other than those covered under sub -
section (1), on the person chargeable with tax.
(4) The service of such statement shall be deemed to be
service of notice on such person under sub-section (1), subject
to the condition that the grounds relied upon for such tax
periods other than those covered under sub-section (1) are the
same as are mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of

notice under sub-section (1) or, as the case may be, the
statement under sub-section (3), pay the amount of tax along
with interest payable thereon under section 50 on the basis of
his own ascertainment of such tax or the tax as ascertained by
the proper officer and inform the proper officer in writing of such
payment.

83
 (6) The proper officer, on receipt of such information, shall
not serve any notice under sub-section (1) or, as the case may
be, the statement under sub-section (3), in respect of the tax so
paid or any penalty payable under the provisions of this Act or
the rules made thereunder.

(7) Where the proper officer is of the opinion that the

amount paid under sub-section (5) falls short of the amount
actually payable, he shall proceed to issue the notice as
provided for in sub-section (1) in respect of such amount which
falls short of the amount actually payable.

(8) Where any person chargeable with tax under sub-

section (1) or sub-section (3) pays the said tax along with
interest payable under section 50 within thirty days of issue of
show cause notice, no penalty shall be payable and all
proceedings in respect of the said notice shall be deemed to be
concluded.

(9) The proper officer shall, after considering the

representation, if any, made by person chargeable with tax,
determine the amount of tax, interest and a penalty equivalent to
ten per cent. of tax or ten thousand rupees, whichever is higher,
due from such person and issue an order.

(10) The proper officer shall issue the order under sub-
section (9) within three years from the due date for furnishing of
annual return for the financial year to which the tax not paid or
short paid or input tax credit wrongly availed or utilized relates to
or within three years from the date of erroneous refund.

(11) Notwithstanding anything contained in sub-section (6)

or sub-section (8), penalty under sub-section (9) shall be
payable where any amount of self-assessed tax or any amount
collected as tax has not been paid with in a period of thirty days
from the due date of payment of such tax.

Determination of tax
74. (1) Where it appears to the proper officer that any tax not paid or short
has not been paid short paid or erroneously refunded or where paid or
input tax credit has been wrongly availed or utilized by reason of erroneously
refunded or
fraud, or any willful misstatement or suppression of facts to input tax credit
evade tax, he shall serve notice on the person chargeable with wrongly availed
or utilised by
tax which has not been so paid or which has been so short paid reason of fraud
or to whom the refund has erroneously been made, or who has or any wilful
misstatement or
wrongly availed or utilised input tax credit, requiring him to suppression of
show cause as to why he should not pay the amount specified facts.
in the notice along with interest payable thereon under section
50 and a penalty equivalent to the tax specified in the notice.

(2) The proper officer shall issue the notice under sub-
section (1) at least six months prior to the time limit specified in
sub-section (10) for issuance of order.

84
 (3) Where a notice has been issued for any period under
sub-section (1), the proper officer may serve a statement,
containing the details of tax not paid or short paid or
erroneously refunded or input tax credit wrongly availed or
utilised for such periods other than those covered under sub -
section (1), on the person chargeable with tax.
(4) The service of statement under sub-section (3) shall be
deemed to be service of notice under sub-section (1) of section
73, subject to the condition that the grounds relied upon in the
said statement, except the ground of fraud, or any willful-
misstatement or suppression of facts to evade tax, for periods
other than those covered under sub-section (1) are the same as
are mentioned in the earlier notice.

(5) The person chargeable with tax may, before service of

notice under sub-section (1), pay the amount of tax along with
interest payable under section 50 and a penalty equivalent to
fifteen per cent. of such tax on the basis of his own
ascertainment of such tax or the tax as ascertained by the
proper officer and inform the proper officer in writing of such
payment.

(6) The proper officer, on receipt of such information, shall

not serve any notice under sub-section (1), in respect of the tax
so paid or any penalty payable under the provisions of this Act
or the rules made thereunder.

(7) Where the proper officer is of the opinion that the

amount paid under sub-section (5) falls short of the amount
actually payable, he shall proceed to issue the notice as
provided for in sub-section (1) in respect of such amount which
falls short of the amount actually payable.

(8) Where any person chargeable with tax under sub-

section (1) pays the said tax along with interest payable under
section 50 and a penalty equivalent to twenty five per cent. of
such tax within thirty days of issue of the notice, all proceedings
in respect of the said notice shall be deemed to be concluded.
(9) The proper officer shall, after considering the
representation, if any, made by the person chargeable with tax,
determine the amount of tax, interest and penalty due from such
person and issue an order.
(10) The proper officer shall issue the order under sub-
section (9) within a period of five years from the due date for
furnishing of annual return for the financial year to which the tax
not paid or short paid or input tax credit wrongly availed or
utilised relates to or within five years from the date of erroneous
refund.

(11) Where any person served with an order issued under

sub-section (9) pays the tax along with interest payable thereon
under section 50 and a penalty equivalent to fifty per cent. of

85
such tax with in thirty days of communication of the order, all
proceedings in respect of the said notice shall be deemed to be
concluded.
Explanation 1.– For the purposes of section 73 and this
section,—
(i) the expression ―all proceedings in respect of the said
notice‖ shall not include proceedings under section132;

(ii) Where the notice under the same proceedings is issued

to the main person liable to pay tax and some other persons,
and such proceedings against the main person have been
concluded under section 73 or section 74, the proceedings
against all the persons liable to pay penalty under sections 122,
125, 129 and 130 are deemed to be concluded.

Explanation 2.– For the purposes of this Act, the

expression ―suppression‖ shall mean non-declaration of facts or
information which a taxable person is required to declare in the
return, statement, report or any other document furnished under
this Act or the rules made thereunder, or failure to furnish any
information on being asked for, in writing, by the proper officer.

75. (1) Where the service of notice or issuance of order is General Provisions
relating to
stayed by an order of a court or Appellate Tribunal, the period of determination of
such stay shall be excluded in computing the period specified in tax.
sub-sections (2) and (10) of section 73 or sub-sections (2) and
(10) of section 74, as the case may be.

(2) Where any Appellate Authority or Appellate Tribunal or

court concludes that the notice issued under sub-section (1) of
section 74 is not sustainable for the reason that the charges of
fraud or any willful misstatement or suppression of facts to
evade tax has not been established against the person to whom
the notice was issued, the proper officer shall determine the tax
payable by such person, deeming as if the notice were issued
under sub- section (1) of section73.

(3) Where any order is required to be issued in pursuance

of the direction of the Appellate Authority or Appellate Tribunal
or a court, such order shall be issued within two years from the
date of communication of the said direction.

(4) An opportunity of hearing shall be granted where a

request is received in writing from the person chargeable with
tax or penalty, or where any adverse decision is contemplated
against such person.

(5) The proper officer shall, if sufficient cause is shown by

the person chargeable with tax, grant time to the said person
and adjourn the hearing for reasons to be recorded in writing:

Provided that no such adjournment shall be granted for

more than three times to a person during the proceedings.

86
 (6) The proper officer, in his order, shall set out the
relevant facts and the basis of his decision.

(7) The amount of tax, interest and penalty demanded in

the order shall not be in excess of the amount specified in the
notice and no demand shall be confirmed on the grounds other
than the grounds specified in the notice.

(8) Where the Appellate Authority or Appellate Tribunal or

court modifies the amount of tax determined by the proper
officer, the amount of interest and penalty shall stand modified
accordingly, taking into account the amount of tax so modified.

(9) The interest on the tax short paid or not paid shall be
payable whether or not specified in the order determining the tax
liability.

(10) The adjudication proceedings shall be deemed to be

concluded, if the order is not issued within three years as
provided for in sub-section (10) of section 73 or within five years
as provided for in sub-section (10) of section74.
(11) An issue on which the Appellate Authority or the
Appellate Tribunal or the High Court has given its decision which
is prejudicial to the interest of revenue in some other
proceedings and an appeal to the Appellate Tribunal or the High
Court or the Supreme Court against such decision of the
Appellate Authority or the Appellate Tribunal or the High Court is
pending, the period spent between the date of the decision of the
Appellate Authority and that of the Appellate Tribunal or the date
of decision of the Appellate Tribunal and that of the High Court or
the date of the decision of the High Court and that of the
Supreme Court shall be excluded in computing the period
referred to in sub-section (10) of section 73 or sub-section (10) of
section 74 where proceedings are initiated by way of issue of a
show cause notice under the said sections.
(12) Notwithstanding anything contained in section 73 or
section 74, where any amount of self-assessed tax in accordance
with a return furnished under section 39 remains unpaid, either
wholly or partly, or any amount of interest payable on such tax
remains unpaid, the same shall be recovered under the
provisions of section 79.

(13) Where any penalty is imposed under section 73 or

section 74, no penalty for the same act or omission shall be
imposed on the same person under any other provision of this
Act.

Tax collected but 76. (1) Notwithstanding anything to the contrary contained in
not paid to any order or direction of any Appellate Authority or Appellate
Government.
Tribunal or court or in any other provisions of this Act or the
rules made thereunder or any other law for the time being in
force, every person who has collected from any other person any

87
amount as representing the tax under this Act, and has not paid
the said amount to the Government, shall forthwith pay the said
amount to the Government, irrespective of whether the supplies
in respect of which such amount was collected are taxable or not.
(2) Where any amount is required to be paid to the
Government under sub-section (1), and which has not been so
paid, the proper officer may serve on the person liable to pay
such amount a notice requiring him to show cause as to why the
said amount as specified in the notice, should not be paid by him
to the Government and why a penalty equivalent to the amount
specified in the notice should not be imposed on him under the
provisions of this Act.
(3) The proper officer shall, after considering the
representation, if any, made by the person on whom the notice is
served under sub-section (2), determine the amount due from
such person and thereupon such person shall pay the amount so
determined.

(4) The person referred to in sub-section (1) shall in

addition to paying the amount referred to in sub-section (1) or
sub-section (3) also be liable to pay interest thereon at the rate
specified under section 50 from the date such amount was
collected by him to the date such amount is paid by him to the
Government

(5) An opportunity of hearing shall be granted where a

request is received in writing from the person to whom the notice
was issued to show cause.

(6) The proper officer shall issue an order within one year
from the date of issue of the notice.

(7) Where the issuance of order is stayed by an order of

the court or Appellate Tribunal, the period of such stay shall be
excluded in computing the period of one year.

(8) The proper officer, in his order, shall set out the
relevant facts and the basis of his decision.

(9) The amount paid to the Government under sub-section

(1) or sub-section (3) shall be adjusted against the tax payable,
if any, by the person in relation to the supplies referred to in sub -
section (1).

(10) Where any surplus is left after the adjustment under

sub-section (9), the amount of such surplus shall either be
credited to the Fund or refunded to the person who has borne
the incidence of such amount.

(11) The person who has borne the incidence of the

amount, may apply for the refund of the same in accordance
with the provisions of section 54.

88
Tax wrongfully 77. (1) A registered person who has paid the Central tax
collected and
paid to Central and State tax on a transaction considered by him to be an
Government or intra-State supply, but which is subsequently held to be an inter-
State
Government.
State supply, shall be refunded the amount of taxes so paid in
such manner and subject to such conditions as may be
prescribed.

(2) A registered person who has paid integrated tax on a

transaction considered by him to be an inter-State supply, but
which is subsequently held to be an intra-State supply, shall not
be required to pay any interest on the amount of State tax
payable.

Initiation of 78. Any amount payable by a taxable person in pursuance

recovery of an order passed under this Act shall be paid by such person
proceedings.
within a period of three months from the date of service of such
order failing which recovery proceedings shall be initiated:

Provided that where the proper officer considers it

expedient in the interest of revenue, he may, for reasons to be
recorded in writing, require the said taxable person to make
such payment within such period less than a period of three
months as may be specified by him.

Recovery of tax. 79. (1) Where any amount payable by a person to the
Government under any of the provisions of this Act or the rules
made thereunder is not paid, the proper officer shall proceed
to recover the amount by one or more of the following modes,
namely:—

(a) the proper officer may deduct or may require any

other specified officer to deduct the amount so payable from any
money owing to such person which may be under the control of
the proper officer or such other specified officer;

(b) the proper officer may recover or may require any

other specified officer to recover the amount so payable by
detaining and selling any goods belonging to such person which
are under the control of the proper officer or such other specified
officer;
(c) (i) the proper officer may, by a notice in writing,
require any other person from whom money is due or may
become due to such person or who holds or may subsequently
hold money for or on account of such person, to pay to the
Government either forthwith upon the money becoming due or
being held, or within the time specified in the notice not being
before the money becomes due or is held, so much of the money
as is sufficient to pay the amount due from such person or the
whole of the money when it is equal to or less than that
amount;

89
 (ii) every person to whom the notice is issued under
sub-clause (i) shall be bound to comply with such notice, and in
particular, where any such notice is issued to a post office,
banking company or an insurer, it shall not be necessary to
produce any pass book, deposit receipt, policy or any other
document for the purpose of any entry, endorsement or the like
being made before payment is made, notwithstanding any rule,
practice or requirement to the contrary;

(iii) in case the person to whom a notice under sub-

clause (i) has been issued, fails to make the payment in
pursuance thereof to the Government, he shall be deemed to be
a defaulter in respect of the amount specified in the notice and all
the consequences of this Act or the rules made thereunder shall
follow;

(iv) the officer issuing a notice under sub-clause (i)

may, at any time, amend or revoke such notice or extend the
time for making any payment in pursuance of the notice;

(v) any person making any payment in compliance with

a notice issued under sub-clause (i) shall be deemed to have
made the payment under the authority of the person in default
and such payment being credited to the Government shall be
deemed to constitute a good and sufficient discharge of the
liability of such person to the person in default to the extent of the
amount specified in the receipt;

(vi) any person discharging any liability to the person in

default after service on him of the notice issued under sub-clause
(i) shall be personally liable to the Government to the extent of
the liability discharged or to the extent of the liability of the
person in default for tax, interest and penalty, whichever is less;

(vii) where a person on whom a notice is served under

sub- clause (i) proves to the satisfaction of the officer issuing the
notice that the money demanded or any part thereof was not
due to the person in default or that he did not hold any money
for or on account of the person in default, at the time the notice
was served on him, nor is the money demanded or any part
thereof, likely to become due to the said person or be held for
or on account of such person, nothing contained in this section
shall be deemed to require the person on whom the notice has
been served to pay to the Government any such money or part
thereof;

(d) the proper officer may, in accordance with the rules

to be made in this behalf, distrain any movable or immovable
property belonging to or under the control of such person, and
detain the same until the amount payable is paid; and in case,
any part of the said amount payable or of the cost of the
distress or keeping of the property, remains unpaid for a period
of thirty days next after any such distress, may cause the said

90
 property to be sold and with the proceeds of such sale, may
satisfy the amount payable and the costs including cost of sale
remaining un paid and shall render the surplus amount, if any, to
such person;

(e) the proper officer may prepare a certificate signed

by him specifying the amount due from such person and send it
to the Collector of the district in which such person owns any
property or resides or carries on his business or to any officer
authorised by the Government and the said Collector or the said
officer, on receipt of such certificate, shall proceed to recover
from such person the amount specified thereunder as if it were
an arrear of land revenue;
Central Act 2 of
(f) Notwithstanding anything contained in the Code of 1974
Criminal Procedure, 1973, the proper officer may file an
application to the appropriate Magistrate and such Magistrate
shall proceed to recover from such person the amount specified
thereunder as if it were a fine imposed by him.

(2) Where the terms of any bond or other instrument

executed under this Act or any rules or regulations made
thereunder provide that any amount due under such instrument
may be recovered in the manner laid down in sub- section (1),
the amount may, without prejudice to any other mode of
recovery, be recovered in accordance with the provisions of that
sub-section.

(3) Where any amount of tax, interest or penalty is

payable by a person to the Government under any of the
provisions of this Act or the rules made thereunder and which
remains unpaid, the proper officer of Central tax, during the
course of recovery of said tax arrears, may recover the amount
from the said person as if it were an arrear of Central tax and
credit the amount so recovered to the account of the
Government.
(4) Where the amount recovered under sub-section (3) is
less than the amount due to the Central Government and State
Government, the amount to be credited to the account of the
respective Governments shall be in proportion to the amount due
to each such Government.
1
[Explanation.— For the purposes of this section, the word
person shall include ―distinct persons‖ as referred to in sub-
section (4) or, as the case may be, sub-section (5) of section
25.]

Payment of tax 80. On an application filed by a taxable person, the

and other Commissioner may, for reasons to be recorded in writing, extend
amount in
instalments. the time for payment or allow payment of any amount due under

--------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

91
 this Act, other than the amount due as per the liability self-
assessed in any return, by such person in monthly installments
not exceeding twenty four, subject to payment of interest under
section 50 and subject to such conditions and limitations as may
be prescribed:
Provided that where there is default in payment of any one
installment on its due date, the whole outstanding balance payable
on such date shall become due and payable forthwith and shall,
without any further notice being served on the person, be liable for
recovery.
81. Where a person, after any amount has become due from
him, creates a charge on or parts with the property belonging to
Transfer of property
him or in his possession by way of sale, mortgage, exchange, to be void in
or any other mode of transfer whatsoever of any of his properties certain cases.
in favour of any other person with the intention of defrauding the
Government revenue, such charge or transfer shall be void as
against any claim in respect of any tax or any other sum
payable by the said person:

Provided that, such charge or transfer shall not be void if

it is made for adequate consideration, in good faith and without
notice of the pendency of such proceedings under this Act or
without notice of such tax or other sum payable by the said
person, or with the previous permission of the proper officer.

. 82. Notwithstanding anything to the contrary contained in

any law for the time being in force, save as otherwise provided in Tax to be first
Central Act 31 of the Insolvency and Bankruptcy Code, 2016, any amount payable charge on
2016 property
by a taxable person or any other person on account of tax,
interest or penalty which he is liable to pay to the
Government shall be a first charge on the property of such
taxable person or such person.

83. (1) Where during the pendency of any proceedings

under section 62 or section 63 or section 64 or section 67 or Provisional
section 73 or section 74, the Commissioner is of the opinion attachment to
protect revenue
that for the purpose of protecting the interest of the Government in certain
revenue, it is necessary so to do, he may, by order in writing cases.
attach provisionally any property, including bank account,
belonging to the taxable person in such manner as may be
prescribed.

(2) Every such provisional attachment shall cease to have

effect after the expiry of a period of one year from the date of the
order made under sub-section (1).

84. Where any notice of demand in respect of any tax, Continuation and
penalty, interest or any other amount payable under this Act, validation of
certain
(hereafter in this section referred to as ―Government dues‖), is recovery
served upon any taxable person or any other person and any proceedings.
appeal or revision application is filed or any other proceedings is
initiated in respect of such Government dues, then —

92
 (a) where such Government dues are enhanced in such
appeal, revision or other proceedings, the Commissioner shall
serve upon the taxable person or any other person another
notice of demand in respect of the amount by which such
Government dues are enhanced and any recovery proceedings
in relation to such Government dues as are covered by the
notice of demand served upon him before the disposal of such
appeal, revision or other proceedings may, without the service of
any fresh notice of demand, be continued from the stage at
which such proceedings stood immediately before such disposal;

(b) where such Government dues are reduced in such

appeal, revision or in other proceedings—

(i) it shall not be necessary for the Commissioner to

serve upon the taxable person a fresh notice of demand;

(ii) the Commissioner shall give intimation of such

reduction to him and to the appropriate authority with whom
recovery proceedings is pending;

(iii) any recovery proceedings initiated on the basis of the

demand served upon him prior to the disposal of such appeal,
revision or other proceedings may be continued in relation to the
amount so reduced from the stage at which such proceedings
stood immediately before such disposal.

CHAPTER XVI.
LIABILITY TO PAY IN CERTAIN CASES.

85. (1) Where a taxable person, liable to pay tax under this
Liability in case of
transfer of Act, transfers his business in whole or in part, by sale, gift, lease,
business. leave and license, hire or in any other manner whatsoever, the
taxable person and the person to whom the business is so
transferred shall, jointly and severally, be liable wholly or to the
extent of such transfer, to pay the tax, interest or any penalty due
from the taxable person up to the time of such transfer, whether
such tax, interest or penalty has been determined before such
transfer, but has remained unpaid or is determined thereafter.
(2) Where the transferee of a business referred to in sub-
section (1) carries on such business either in his own name or in
some other name, he shall be liable to pay tax on the supply of
goods or services or both effected by him with effect from the
date of such transfer and shall, if he is a registered person under
this Act, apply within the prescribed time for amendment of his
certificate of registration.

Liability of agent 86. Where an agent supplies or receives any taxable goods
and principal. on behalf of his principal, such agent and his principal shall,
jointly and severally, be liable to pay the tax payable on such
goods under this Act.

93
 87. (1) When two or more companies are amalgamated or Liability in case of
amalgamation
merged in pursuance of an order of court or of Tribunal or or merger of
otherwise and the order is to take effect from a date earlier to companies.
the date of the order and any two or more of such companies
have supplied or received any goods or services or both to or
from each other during the period commencing on the date from
which the order takes effect till the date of the order, then such
transactions of supply and receipt shall be included in the
turnover of supply or receipt of the respective companies and
they shall be liable to pay tax accordingly.

(2) Notwithstanding anything contained in the said order, for

the purposes of this Act, the said two or more companies shall be
treated as distinct companies for the period up to the date of the
said order and the registration certificates of the said companies
shall be cancelled with effect from the date of the said order.

88. (1) When any company is being wound up whether Liability in case of
under the orders of a court or Tribunal or otherwise, every person company in
liquidation.
appointed as receiver of any assets of a company (hereafter in
this section referred to as the ―liquidator‖), shall, with in thirty
days after his appointment, give intimation of his appointment to
the Commissioner.
(2) The Commissioner shall, after making such inquiry or
calling for such information as he may deem fit, notify the
liquidator within three months from the date on which he receives
intimation of the appointment of the liquidator, the amount which
in the opinion of the Commissioner would be sufficient to provide
for any tax, interest or penalty which is then, or is likely thereafter
to become, payable by the company.

(3) When any private company is wound up and any tax,

interest or penalty determined under this Act on the company for
any period, whether before or in the course of or after its
liquidation, cannot be recovered, then every person who was a
director of such company at any time during the period for
which the tax was due shall, jointly and severally, be liable for the
payment of such tax, interest or penalty, unless he proves to the
satisfaction of the Commissioner that such non-recovery cannot
be attributed to any gross neglect, misfeasance or breach of
duty on his part in relation to the affairs of the company.

Central Act 18 of 89. (1) Notwithstanding anything contained in the Companies Liability of directors
2013 Act, 2013, where any tax, interest or penalty due from a private of private
company.
company in respect of any supply of goods or services or both
for any period cannot be recovered, then, every person who was
a director of the private company during such period shall, jointly
and severally, be liable for the payment of such tax, interest or
penalty unless he proves that the non-recovery cannot be
attributed to any gross neglect, misfeasance or breach of duty on
his part in relation to the affairs of the company.

94
 (2) Where a private company is converted into a public
company and the tax, interest or penalty in respect of any
supply of goods or services or both for any period during which
such company was a private company cannot be recovered
before such conversion, then, nothing contained in sub- section
(1) shall apply to any person who was a director of such private
company in relation to any tax, interest or penalty in respect of
such supply of goods or services or both of such private
company:
Provided that nothing contained in this sub-section shall
apply to any personal penalty imposed on such director.

Liability of 90. Notwithstanding any contract to the contrary and any

partners of firm
to pay tax.
other law for the time being in force, where any firm is liable to
pay any tax, interest or penalty under this Act, the firm and each
of the partners of the firm shall, jointly and severally, be liable
for such payment:

Provided that where any partner retires from the firm, he

or the firm, shall intimate the date of retirement of the said
partner to the Commissioner by a notice in that behalf in writing
and such partner shall be liable to pay tax, interest or penalty
due upto the date of his retirement whether determined or not, on
that date:

Provided further that if no such intimation is given within one

month from the date of retirement, the liability of such partner
under the first proviso shall continue until the date on which such
intimation is received by the Commissioner.

Liability of 91. Where the business in respect of which any tax, interest
guardians,
trustees, etc. or penalty is payable under this Act is carried on by any
guardian, trustee or agent of a minor or other incapacitated
person on behalf of and for the benefit of such minor or other
incapacitated person, the tax, interest or penalty shall be levied
upon and recoverable from such guardian, trustee or agent in like
manner and to the same extent as it would be determined and
recoverable from any such minor or other incapacitated person,
as if he were a major or capacitated person and as if he were
conducting the business himself, and all the provisions of this
Act or the rules made thereunder shall apply accordingly.

Liability of Court of 92. Where the estate or any portion of the estate of a
Wards, etc.
taxable person owning a business in respect of which any tax,
interest or penalty is payable under this Act is under the control
of the Court of Wards, the Administrator General, the Official
Trustee or any receiver or manager (including any person,
whatever be his designation, who in fact manages the business)
appointed by or under any order of a court, the tax, interest or
penalty shall be levied upon and be recoverable from such Court
of Wards, Administrator General, Official Trustee, receiver or

95
 manager in like manner and to the same extent as it would be
determined and be recoverable from the taxable person as if he
were conducting the business himself, and all the provisions of
this Act or the rules made thereunder shall apply accordingly.

Central Act 31
93. (1) Save as otherwise provided in the Insolvency and Special
of 2016. Bankruptcy Code, 2016, where a person, liable to pay tax, provisions
regarding liability
interest or penalty under this Act, dies, then— to pay tax,
interest or
(a) if a business carried on by the person is penalty in certain
cases.
continued after his death by his legal representative or any other
person, such legal representative or other person, shall be liable to
pay tax, interest or penalty due from such person under this Act;
and

(b) if the business carried on by the person is

discontinued, whether before or after his death, his legal
representative shall be liable to pay, out of the estate of the
deceased, to the extent to which the estate is capable of meeting
the charge, the tax, interest or penalty due from such person
under this Act,

whether such tax, interest or penalty has been determined

before his death but has remained unpaid or is determined after
his death.

Central Act 31 (2) Save as otherwise provided in the Insolvency and

of 2016.
Bankruptcy Code, 2016, where a taxable person, liable to pay
tax, interest or penalty under this Act, is a Hindu Undivided
Family or an association of persons and the property of the
Hindu Undivided Family or the association of persons is
partitioned amongst the various members or groups of members,
then, each member or group of members shall, jointly and
severally, be liable to pay the tax, interest or penalty due from
the taxable person under this Act up to the time of the partition
whether such tax, penalty or interest has been determined before
partition but has remained unpaid or is determined after the
partition.

Central Act 31 (3) Save as otherwise provided in the Insolvency and

of 2016
Bankruptcy Code, 2016, where a taxable person, liable to pay
tax, interest or penalty under this Act, is a firm, and the firm is
dissolved, then, every person who was a partner shall, jointly
and severally, be liable to pay the tax, interest or penalty due
from the firm under this Act upto the time of dissolution whether
such tax, interest or penalty has been determined before the
dissolution, but has remained unpaid or is determined after
dissolution.

Central Act 31
(4) Save as otherwise provided in the Insolvency and
of 2016 Bankruptcy Code, 2016, where a taxable person liable to pay
tax, interest or penalty under this Act,—
(a) is the guardian of a ward on whose behalf the
business is carried on by the guardian; or

96
 (b) is a trustee who carries on the business under a
trust for a beneficiary,

then, if the guardianship or trust is terminated, the ward or

the beneficiary shall be liable to pay the tax, interest or penalty
due from the taxable person upto the time of the termination of
the guardianship or trust, whether such tax, interest or penalty
has been determined before the termination of guardianship or trust
but has remained unpaid or is determined thereafter.

Liability in other 94. (1) Where a taxable person is a firm or an association

cases. of persons or a Hindu Undivided Family and such firm,
association or family has discontinued business—
(a) the tax, interest or penalty payable under this Act
by such firm, association or family up to the date of such
discontinuance may be determined as if no such discontinuance
had taken place; and

(b) every person who, at the time of such

discontinuance, was a partner of such firm, or a member of such
association or family, shall, notwithstanding such
discontinuance, jointly and severally, be liable for the payment of
tax and interest determined and penalty imposed and payable by
such firm, association or family, whether such tax and interest
has been determined or penalty imposed prior to or after such
discontinuance and subject as aforesaid, the provisions of this
Act shall, so far as may be, apply as if every such person
or partner or member were himself a taxable person.

(2) Where a change has occurred in the constitution of a

firm or an association of persons, the partners of the firm or
members of association, as it existed before and as it exists
after the reconstitution, shall, without prejudice to the provisions
of section 90, jointly and severally, be liable to pay tax,
interest or penalty due from such firm or association for any
period before its reconstitution.
(3) The provisions of sub-section (1) shall, so far as may be,
apply where the taxable person, being a firm or association of
persons is dissolved or where the taxable person, being a Hindu
Undivided Family, has effected partition with respect to the
business carried on by it and accordingly references in that sub -
section to discontinuance shall be construed as reference to
dissolution or to partition.

Explanation.— For the purposes of this Chapter,— Central Act 6 of

2009
(i) a ―Limited Liability Partnership‖ formed and registered
under the provisions of the Limited Liability Partnership Act,
2008 shall also be considered as a firm;
(ii) ―court‖ means the District Court, High Court or
Supreme Court.

97
 CHAPTER XVII.
ADVANCE RULING.

95. In this Chapter, unless the context otherwise requires,— Definitions.

(a) ―advance ruling‖ means a decision provided by the

1
Authority or the Appellate Authority [or the National Appellate
Authority] to an applicant on matters or on questions specified in
sub-section (2) of section 97 or sub-section (1) of section 100
2
[or of Section 101 C of the Central Goods and Services Tax Act],
in relation to the supply of goods or services or both being
under taken or proposed to be under taken by the applicant;

(b) ―Appellate Authority‖ means the Appellate Authority for

Advance Ruling constituted under section 99;

(c) ―applicant‖ means any person registered or desirous of

obtaining registration under this Act;

(d) ―application‖ means an application made to the Authority

under sub-section (1) of section 97;

(e) ―Authority‖ means the Authority for Advance Ruling,

constituted under section 96.
3
[(f) ―National Appellate Authority‖ means the National
Appellate Authority for Advance Ruling referred to in section
101A].

96. (1) The Government shall, by notification, constitute an Constitution of

Authority for
Authority to be known as the Tamil Nadu Authority for Advance Advance Ruling.
Ruling:

Provided that the Government may, on the recommendation

of the Council, notify any Authority located in another State to act
as the Authority for the State.

(2) The Authority shall consist of—

(i) one member from amongst the officers of Central tax;

and

(ii) one member from amongst the officers of State tax,

to be appointed by the Central Government and the State

Government respectively.

(3) The qualifications, the method of appointment of the

members and the terms and conditions of their services shall be
such as may be prescribed.
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1
Inserted by TN Act 10 of 2020 dated 15.02.2020 [NOT YET GIVEN EFFECT]
2
Inserted by TN Act 10 of 2020 dated 15.02.2020 [NOT YET GIVEN EFFECT]
3
Inserted by TN Act 10 of 2020 dated 15.02.2020 [NOT YET GIVEN EFFECT]

98
Application for 97. (1) An applicant desirous of obtaining an advance ruling
advance ruling. under this Chapter may make an application in such form and
manner and accompanied by such fee as may be prescribed,
stating the question on which the advance ruling is sought.

(2) The question on which the advance ruling is sought

under this Act, shall be in respect of,—
(a) classification of any goods or services or both;
(b) applicability of a notification issued under the
provisions of this Act.
(c) determination of time and value of supply of goods or
services or both;
(d) admissibility of input tax credit of tax paid or deemed
to have been paid;
(e) determination of the liability to pay tax on any goods
or services or both;
(f) whether applicant is required to be registered;
(g) whether any particular thing done by the applicant
with respect to any goods or services or both amounts to or
results in a supply of goods or services or both, within the
meaning of that term.

Procedure on 98. (1) On receipt of an application, the Authority shall

receipt of cause a copy thereof to be forwarded to the concerned officer
application.
and, if necessary, call upon him to furnish the relevant records:

Provided that where any records have been called for by

the Authority in any case, such records shall, as soon as
possible, be returned to the said concerned officer.
(2) The Authority may, after examining the application and
the records called for and after hearing the applicant or his
authorised representative and the concerned officer or his
authorised representative, by order, either admit or reject the
application:

Provided that the Authority shall not admit the application

where the question raised in the application is already pending
or decided in any proceedings in the case of an applicant under
any of the provisions of this Act:
Provided further that no application shall be rejected under
this sub- section unless an opportunity of hearing has been
given to the applicant:
Provided also that where the application is rejected, the
reasons for such rejection shall be specified in the order.

(3) A copy of every order made under sub-section (2) shall

be sent to the applicant and to the concerned officer.
(4) Where an application is admitted under sub-section (2),
the Authority shall, after examining such further material as may
be placed before it by the applicant or obtained by the Authority
and after providing an opportunity of being heard to the applicant

99
or his authorised representative as well as to the concerned
officer or his authorised representative, pronounce its advance
ruling on the question specified in the application.
(5) Where the members of the Authority differ on any
question on which the advance ruling is sought, they shall state
the point or points on which they differ and make a reference to
the Appellate Authority for hearing and decision on such
question.
(6) The Authority shall pronounce its advance ruling in
writing within ninety days from the date of receipt of application.
(7) A copy of the advance ruling pronounced by the
Authority duly signed by the members and certified in such
manner as may be prescribed shall be sent to the applicant, the
concerned officer and the jurisdictional officer after such
pronouncement.

99. The Government shall, by notification, constitute an Constitution of

Appellate
Authority to be known as the Tamil Nadu Appellate Authority for Authority for
Advance Ruling for Goods and Services Tax for hearing Advance Ruling.
appeals against the advance ruling pronounced by the
Advance Ruling Authority consisting of—

(i) the Chief Commissioner of Central tax as designated by

the Board; and

(ii) the Commissioner of State tax:

Provided that the Government may, on the

recommendations of the Council, notify any Appellate Authority
located in another State or Union territory to act as the Appellate
Authority for the State.

100. (1) The concerned officer, the jurisdictional officer or Appeal to the
Appellate
an applicant aggrieved by any advance ruling pronounced under Authority.
sub-section (4) of section 98, may appeal to the Appellate
Authority.

(2) Every appeal under this section shall be filed within a

period of thirty days from the date on which the ruling sought to
be appealed against is communicated to the concerned officer,
the jurisdictional officer and the applicant:

Provided that the Appellate Authority may, if it is satisfied

that the appellant was prevented by a sufficient cause from
presenting the appeal within the said period of thirty days, allow
it to be presented within a further period not exceeding thirty
days.

(3) Every appeal under this section shall be in such form,

accompanied by such fee and verified in such manner as may be
prescribed.

100
Orders of Appellate 101. (1) The Appellate Authority may, after giving the
Authority. parties to the appeal or reference an opportunity of being heard,
pass such order as it thinks fit, confirming or modifying the ruling
appealed against or referred to.

(2) The order referred to in sub-section (1) shall be passed

within a period of ninety days from the date of filing of the appeal
under section100 or a reference under sub-section (5) of section
98.

(3) Where the members of the Appellate Authority differ on

any point or points referred to in appeal or reference, it shall be
deemed that no advance ruling can be issued in respect of the
question under the appeal or reference.

(4) A copy of the advance ruling pronounced by the

Appellate Authority duly signed by the Members and certified in
such manner as may be prescribed shall be sent to the
applicant, the concerned officer, the jurisdictional officer and to
the Authority after such pronouncement.
1 1
[National Appellate [101A. Subject to the provisions of this chapter, for the Insertion of new
Authority for section 101A
Advance Ruling purposes of this act, the National appellate authority for advance
under the ruling constituted under section 101A of the Central Goods and
Central Goods
and Services
Services Tax Act shall be deemed to be the National appellate
Tax Act shall be authority for Advance Ruling under this Act.].
Appellate
Authority under
this Act.]
2
Rectification of 102. The Authority or the Appellate Authority [or the
advance ruling.
National Appellate Authority] may amend any order passed by it
3
under section 98 or [or section 101 of this Act or section 101 C
of the Central Goods and Services Tax Act], so as to rectify any
error apparent on the face of the record, if such error is noticed
2
by the Authority or the Appellate Authority [or the National
Appellate Authority] on its own accord, or is brought to its notice
by the concerned officer, the jurisdictional officer, the applicant
4
[appellant, the Authority or the Appellate Authority] within a
period of six months from the date of the order:

Provided that no rectification which has the effect of

enhancing the tax liability or reducing the amount of admissible
input tax credit shall be made unless the applicant or the
appellant has been given an opportunity of being heard.

Applicability of 103. (1) The advance ruling pronounced by the Authority or

advance ruling.
the Appellate Authority under this Chapter shall be binding
only—
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1
Inserted by TN Act 10 of 2020 dated 15.02.2020 [NOT YET GIVEN EFFECT]
2
Inserted by TN Act 10 of 2020 dated 15.02.2020 [NOT YET GIVEN EFFECT]
3
Substituted for ―or section 101‖by TN Act 10 of 2020 dated 15.02.2020 [NOT
YET GIVEN EFFECT]
4
Substituted for ―or the appellant‖by TN Act 10 of 2020 dated 15.02.2020 [NOT
YET GIVEN EFFECT]

101
 (a) on the applicant who had sought it in respect of any
matter referred to in sub-section (2) of section 97 for advance
ruling;

(b) on the concerned officer or the jurisdictional officer

in respect of the applicant.
1
[(1A) The Advance Ruling pronounced by the National
appellate authority under this chapter shall be binding on—

(a) the applicants, being distinct persons, who had

sought the ruling under sub-section (1) of section 101B of the
Central Goods and Services Tax Act and all registered persons
having the same Permanent account Number issued under the
income-tax act, 1961;

(b) the concerned officers and the jurisdictional officers

in respect of the applicants referred to in clause (a) and the
registered persons having the same Permanent account Number
issued under the income-tax act, 1961.;]
2
(2) The advance ruling referred to in sub-section (1) [and sub-
section (1-A)] shall be binding unless the law, facts or
circumstances supporting the original advance ruling have
changed.

3
104. (1) Where the Authority or the Appellate Authority [or Advance ruling to be
the National Appellate Authority] finds that advance ruling void in certain
circumstances.
pronounced by it under sub-section (4) of section 98 or under
4
sub-section (1) [of section 101 of this Act or section 101C of the
Central Goods and Services Tax Act] has been obtained by the
applicant or the appellant by fraud or suppression of material
facts or misrepresentation of facts, it may, by order, declare
such ruling to be void ab-initio and thereupon all the provisions
of this Act or the rules made thereunder shall apply to the
applicant or the appellant as if such advance ruling had never
been made:

Provided that no order shall be passed under this sub-

section unless an opportunity of being heard has been given to
the applicant or the appellant.

Explanation.— The period beginning with the date of such

advance ruling and ending with the date of order under this sub-
section shall be excluded while computing the period specified in
sub-sections (2) and (10) of section 73 or sub-sections (2) and
(10) of section 74.
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1
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
2
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
3
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
4
Substituted for ―of section 101‖ by TN Act 10 of 2020 dated 15.02.2020, [NOT
YET GIVEN EFFECT]

102
 (2) A copy of the order made under sub-section (1) shall
be sent to the applicant, the concerned officer and the
jurisdictional officer.

1
[Powers of 2
105. (1) The Authority or the Appellate Authority [or the
Authority,
Appellate National Appellate Authority] shall, for the purpose of exercising
Authority and its powers regarding—
National
Appellate
Authority] (a) discovery and inspection;

(b) enforcing the attendance of any person and examining

him on oath;

(c) Issuing commissions and compelling production of

books of account and other records,
Central Act 5 of
have all the powers of a civil court under the Code of Civil 1908
Procedure, 1908.
3
(2) The Authority or the Appellate Authority [or the
National Appellate Authority] shall be deemed to be a civil Central Act 2 of
1974
court for the purposes of section 195, but not for the purposes of
Chapter XXVI of the Code of Criminal Procedure, 1973, and
Central Act 45 of
every proceeding before the Authority or the Appellate Authority 1860
3
[or the National Appellate Authority] shall be deemed to be a
judicial proceedings within the meaning of sections 193 and
228, and for the purpose of section 196 of the Indian Penal
Code.

4 5
[Procedure of 106. The Authority or the Appellate Authority [or the
Authority,
Appellate National Appellate Authority] shall, subject to the provisions of
Authority and this Chapter, have power to regulate its own procedure.
National
Appellate
Authority.]

CHAPTER XVIII.
APPEALS AND REVISION.

Appeals to
Appellate
107. (1) Any person aggrieved by any decision or order
Authority. passed under this Act or the Central Goods and Services Tax
Act by an adjudicating authority may appeal to such Appellate
Authority as may be prescribed within three months from the
date on which the said decision or order is communicated to
such person.
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1
Substituted for ―Powers of Authority and Appellate Authority‖ by TN Act 10 of
2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
2
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
3
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
4
Substituted for ―Procedure of Authority and Appellate Authority‖ by TN Act 10
of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]
5
Inserted by TN Act 10 of 2020 dated 15.02.2020, [NOT YET GIVEN EFFECT]

103
 (2) The Commissioner may, on his own motion, or upon
request from the Commissioner of Central tax, call for and
examine the record of any proceeding in which an adjudicating
authority has passed any decision or order under this Act or the
Central Goods and Services Tax Act, for the purpose of
satisfying himself as to the legality or propriety of the said
decision or order and may, by order, direct any officer
subordinate to him to apply to the Appellate Authority within six
months from the date of communication of the said decision or
order for the determination of such points arising out of the said
decision or order as may be specified by the Commissioner in his
order.

(3) Where, in pursuance of an order under sub-section (2),

the authorized officer makes an application to the Appellate
Authority, such application shall be dealt with by the Appellate
Authority as if it were an appeal made against the decision or
order of the adjudicating authority and such authorized officer
were an appellant and the provisions of this Act relating to
appeals shall apply to such application.

(4) The Appellate Authority may, if he is satisfied that the

appellant was prevented by sufficient cause from presenting the
appeal within the aforesaid period of three months or six
months, as the case may be, allow it to be presented wi thin
a further period of one month.

(5) Every appeal under this section shall be in such form

and shall be verified in such manner as may be prescribed.

(6) No appeal shall be filed under sub-section (1), unless

the appellant has paid—

(a) in full, such part of the amount of tax, interest,

fine, fee and penalty arising from the impugned order, as is
admitted by him; and

(b) a sum equal to ten per cent. of the remaining

1
amount of tax in dispute arising from the said order, [subject to
a maximum of twenty five crore rupees] in relation to which the
appeal has been filed.

(7) Where the appellant has paid the amount under sub-
section (6), the recovery proceedings for the balance amount
shall be deemed to be stayed.

(8) The Appellate Authority shall give an opportunity to the

appellant of being heard.

(9) The Appellate Authority may, if sufficient cause is

shown at any stage of hearing of an appeal, grant time to the
parties or any of them and adjourn the hearing of the appeal for
reasons to be recorded in writing:
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1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

104
 Provided that no such adjournment shall be granted more
than three times to a party during hearing of the appeal.

(10) The Appellate Authority may, at the time of hearing of

an appeal, allow an appellant to add any ground of appeal not
specified in the grounds of appeal, if it is satisfied that the
omission of that ground from the grounds of appeal was not
willful or unreasonable.

(11) The Appellate Authority shall, after making such

further inquiry as may be necessary, pass such order, as it
thinks just and proper, confirming, modifying or annulling the
decision or order appealed against but shall not refer the case
back to the adjudicating authority that passed the said decision
or order:

Provided that an order enhancing any fee or penalty or

fine in lieu of confiscation or confiscating goods of greater value
or reducing the amount of refund or input tax credit shall not be
passed unless the appellant has been given a reasonable
opportunity of showing cause against the proposed order:

Provided further that where the Appellate Authority is of

the opinion that any tax has not been paid or short-paid or
erroneously refunded, or where input tax credit has been
wrongly availed or utilised, no order requiring the appellant to
pay such tax or input tax credit shall be passed unless the
appellant is given notice to show cause against the proposed
order and the order is passed within the time limit specified
under section 73 or section 74.

(12) The order of the Appellate Authority disposing of the

appeal shall be in writing and shall state the points for
determination, the decision thereon and the reasons for such
decision.

(13) The Appellate Authority shall, where it is possible to

do so, hear and decide every appeal within a period of one year
from the date on which it is filed:
Provided that where the issuance of order is stayed by
an order of a court or Tribunal, the period of such stay shall
be excluded in computing the period of one year.

(14) On disposal of the appeal, the Appellate Authority

shall communicate the order passed by it to the appellant,
respondent and to the adjudicating authority.
(15) A copy of the order passed by the Appellate Authority
shall also be sent to the Commissioner or the authority
designated by him in his behalf and the jurisdictional
Commissioner of Central tax or an authority designated by him
in this behalf.

105
 (16) Every order passed under this section shall, subject to
the provisions of section 108 or section 113 or section 117 or
section 118 be final and binding on the parties.

108. (1) Subject to the provisions of section 121 and any Powers of
Revisional
rules made thereunder, the Revisional Authority may, on his own
Authority.
motion, or upon information received by him or on request from
the Commissioner of Central tax, call for and examine the
record of any proceedings, and if he considers that any decision
or order passed under this Act or under the Central Goods and
Services Tax Act by any officer subordinate to him is erroneous
in so far as it is prejudicial to the interest of revenue and is
illegal or improper or has not taken into account certain material
facts, whether available at the time of issuance of the said
order or not or in consequence of an observation by the
Comptroller and Auditor General of India, he may, if necessary,
stay the operation of such decision or order for such period as
he deems fit and after giving the person concerned an
opportunity of being heard and after making such further inquiry
as may be necessary, pass such order, as he thinks just and
proper, including enhancing or modifying or annulling the said
decision or order.

(2) The Revisional Authority shall not exercise any power

under sub- section (1), if—

(a) the order has been subject to an appeal under

section 107 or section 112 or section 117 or section 118; or

(b) the period specified under sub-section (2) of section

107 has not yet expired or more than three years have expired
after the passing of the decision or order sought to be revised;
or

(c) the order has already been taken for revision under
this section at an earlier stage; or

(d) the order has been passed in exercise of the powers

under sub-section (1):

Provided that the Revisional Authority may pass an

order under sub-section (1) on any point which has not been
raised and decided in an appeal referred to in clause (a) of sub-
section (2), before the expiry of a period of one year from the
date of the order in such appeal or before the expiry of a period
of three years referred to in clause (b) of that sub-section,
whichever is later.

(3) Every order passed in revision under sub-section (1)

shall, subject to the provisions of section 113 or section 117 or
section 118, be final and binding on the parties.

106
 (4) If the said decision or order involves an issue on which
the Appellate Tribunal or the High Court has given its decision in
some other proceedings and an appeal to the High Court or the
Supreme Court against such decision of the Appellate Tribunal
or the High Court is pending, the period spent between the date
of the decision of the Appellate Tribunal and the date of the
decision of the High Court or the date of the decision of the High
Court and the date of the decision of the Supreme Court shall
be excluded in computing the period of limitation referred to in
clause (b) of sub-section (2) where proceedings for revision
have been initiated by way of issue of a notice under this
section.

(5) Where the issuance of an order under sub-section (1) is

stayed by the order of a court or Appellate Tribunal, the period
of such stay shall be excluded in computing the period of
limitation referred to in clause (b) of sub-section (2).

(6) For the purposes of this section, the term,—

(i) ―record‖ shall include all records relating to any

proceedings under this Act available at the time of examination
by the Revisional Authority;

(ii) ―decision‖ shall include intimation given by any officer

lower in rank than the Revisional Authority.

Appellate Tribunal 109. (1) Subject to the provisions of this Chapter, the Goods
and Benches
and Services Tax Tribunal constituted under the Central Goods
thereof.
and Services Tax Act shall be the Appellate Tribunal for hearing
appeals against the orders passed by the Appellate Authority or
the Revisional Authority under this Act.

(2) The constitution and jurisdiction of the State Bench and

the Area Benches located in the State shall be in accordance
with the provisions of section 109 of the Central Goods and
Services Tax Act or the rules made thereunder.

President and 110. The qualifications, appointment, salary and allowances,

Members of
terms of office, resignation and removal of the President and
Appellate
Tribunal, their Members of the State Bench and Area Benches shall be in
qualification, accordance with the provisions of section 110 of the Central
appointment, Goods and Services Tax Act.
conditions of
service, etc.

Procedure before 111. (1) The Appellate Tribunal shall not, while disposing of
Appellate
Tribunal.
any proceedings before it or an appeal before it, be bound by the
procedure laid down in the Code of Civil Procedure, 1908, but shall Central Act 5 of
be guided by the principles of natural justice and subject to the 1908.
other provisions of this Act and the rules made thereunder, the

107
 Appellate Tribunal shall have power to regulate its own procedure.

(2) The Appellate Tribunal shall, for the purposes of

discharging its functions under this Act, have the same powers
Central Act 5 of
as are vested in a civil court under the Code of Civil Procedure,
1908
1908, while trying a suit in respect of the following matters,
namely:—

(a) summoning and enforcing the attendance of any

person and examining him on oath;

(b) requiring the discovery and production of documents;

(c) receiving evidence on affidavits;

(d) subject to the provisions of sections 123 and 124 of

the Indian Evidence Act, 1872, requisitioning any public record or
document or a copy of such record or document from any office;

(e) issuing commissions for the examination of witnesses

or documents;

(f) dismissing a representation for default or deciding it

exparte;

(g) setting aside any order of dismissal of any

representation for default or any order passed by it ex parte; and

(h) any other matter which may be prescribed.

(3) Any order made by the Appellate Tribunal may be enforced

by it in the same manner as if it were a decree made by a court in a
suit pending therein, and it shall be lawful for the Appellate
Tribunal to send for execution of its orders to the court within the
local limits of whose jurisdiction,—

(a) in the case of an order against a company, the

registered office of the company is situated; or

(b) in the case of an order against any other person, the

person concerned voluntarily resides or carries on business or
personally works for gain.

(4) All proceedings before the Appellate Tribunal shall be

deemed to be judicial proceedings within the meaning of sections
Central Act 45 of 193 and 228, and for the purposes of section 196 of the Indian
1860
Penal Code, and the Appellate Tribunal shall be deemed to be
Central Act 2 of
1974 civil court for the purposes of section 195 and Chapter XXVI
of the Code of Criminal Procedure,1973.

108
Appeals to 112. (1) Any person aggrieved by an order passed against
Appellate
Tribunal. him under section 107 or section 108 of this Act or the Central
Goods and Services Tax Act may appeal to the Appellate
1
Tribunal against such order within [three months] from the date
on which the order sought to be appealed against is
communicated to the person preferring the appeal.

(2) The Appellate Tribunal may, in its discretion, refuse to

admit any such appeal where the tax or input tax credit involved
or the difference in tax or input tax credit involved or the amount
of fine, fee or penalty determined by such order, does not exceed
fifty thousand rupees.

(3) The Commissioner may, on his own motion, or upon

request from the Commissioner of Central tax, call for and
examine the record of any order passed by the Appellate
Authority or the Revisional Authority under this Act or under the
Central Goods and Services Tax Act for the purpose of satisfying
himself as to the legality or propriety of the said order and
may, by order, direct any officer subordinate to him to apply to the
1
Appellate Tribunal within [six months] from the date on which
the said order has been passed for determination of such points
arising out of the said order as may be specified by the
Commissioner in his order.

(4) Where in pursuance of an order under sub-section (3)

the authorized officer makes an application to the Appellate
Tribunal, such application shall be dealt with by the Appellate
Tribunal as if it were an appeal made against the order under
sub-section (11) of section 107 or under sub-section (1) of
section 108 and the provisions of this Act shall apply to such
application, as they apply in relation to appeals filed under sub-
section (1).

--------------------------------------------------------------------------------------
1
Clarified that for the purpose of calculating,-
(a) the ―three months from the date on which the order sought to be appealed
against is communicated to the person preferring the appeal‖ in sub-section (1) of
section 112, the start of the three months period shall be considered to be the later
of the following dates:-
(i) date of communication of order; or
(ii) the date on which the President or the State President, as the case may be, of
the Appellate Tribunal after its constitution under Section 109, enters office;
(b) the ―six months from the date on which the said order has been passed‖ in sub-
section (3) of Section 112, the start of the six months period shall be considered to
be the later of the following dates:-
(i) date of communication of order; or
(ii) the date on which the President or the State President, as the case may be, of
the Appellate Tribunal after its constitution under section 109, enters office.
Vide Tamil Nadu Goods and Services Tax (Ninth Removal of Difficulties)
Order 2019 - G.O.Ms No.185 , Commercial Taxes and Registration (B1) dated
04.12.2019, published in Commercial Taxes and Registration Department
Notification No. SRO A-43(a)/2019 at page 1-2 in Part III-Section 1(a) of the Tamil
Nadu Government Gazette Extraordinary No.448, dated 4th December, 2019.

109
 (5) On receipt of notice that an appeal has been preferred
under this section, the party against whom the appeal has been
preferred may, notwithstanding that he may not have appealed
against such order or any part thereof, file, within forty five days
of the receipt of notice, a memorandum of cross-objections,
verified in the prescribed manner, against any part of the order
appealed against and such memorandum shall be disposed of
by the Appellate Tribunal, as if it were an appeal presented
within the time specified in sub-section (1).

(6) The Appellate Tribunal may admit an appeal within

three months after the expiry of the period referred to in sub-
section (1), or permit the filing of a memorandum of cross-
objections within forty five days after the expiry of the period
referred to in sub-section (5), if it is satisfied that there was
sufficient cause for not presenting it within that period.

(7) An appeal to the Appellate Tribunal shall be in such

form, verified in such manner and shall be accompanied by such
fee, as may be prescribed.

(8) No appeal shall be filed under sub-section (1), unless

the appellant has paid—

(a) in full, such part of the amount of tax, interest,

fine, fee and penalty arising from the impugned order, as is
admitted by him, and

(b) a sum equal to twenty per cent of the remaining

amount of tax in dispute, in addition to the amount paid under
sub-section (6) of section 107, arising from the said order,
1
[subject to a maximum of fifty crore rupees] in relation to which
the appeal has been filed.

(9) Where the appellant has paid the amount as per sub-
section (8), the recovery proceedings for the balance amount
shall be deemed to be stayed till the disposal of the appeal.

(10) Every application made before the Appellate

Tribunal,—

(a) in an appeal for rectification of error or for any other

purpose;
or

(b) for restoration of an appeal or an application,

shall be accompanied by such fees as may be prescribed.

Orders of
113. (1) The Appellate Tribunal may, after giving the parties to Appellate
the appeal an opportunity of being heard, pass such orders Tribunal.
thereon as it thinks fit, confirming, modifying or annulling the
decision or order appealed against or may refer the case back to
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1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019

110
 the Appellate Authority, or the Revision Authority or to the original
adjudicating authority, with such directions as it may think fit,
for a fresh adjudication or decision after taking additional
evidence, if necessary

(2) The Appellate Tribunal may, if sufficient cause is shown,

at any stage of hearing of an appeal, grant time to the parties or
any of them and adjourn the hearing of the appeal for reasons to
be recorded in writing:

Provided that no such adjournment shall be granted more

than three times to a party during hearing of the appeal.

(3) The Appellate Tribunal may amend any order passed by it

under sub-section (1) so as to rectify any error apparent on the face
of the record, if such error is noticed by it on its own accord,
or is brought to its notice by the Commissioner or the
Commissioner of Central tax or the other party to the appeal
within a period of three months from the date of the order:

Provided that no amendment which has the effect of

enhancing an assessment or reducing a refund or input tax credit
or otherwise increasing the liability of the other party, shall be
made under this sub-section, unless the party has been given an
opportunity of being heard.

(4) The Appellate Tribunal shall, as far as possible, hear and

decide every appeal with in a period of one year from the date on
which it is filed.

(5) The Appellate Tribunal shall send a copy of every order

passed under this section to the Appellate Authority or the Revision
Authority, or the original adjudicating authority, as the case may
be, the appellant and the Commissioner or the jurisdictional
Commissioner of Central tax.

(6) Save as provided in section 117 or section 118, orders

passed by the Appellate Tribunal on an appeal shall be final and
binding on the parties.

Financial and
administrative
114. The State President shall exercise such financial and
powers of State administrative powers over the State Bench and Area Benches of
President. the Appellate Tribunal in a State, as may be prescribed:

Provided that the State President shall have the authority to

delegate such of his financial and administrative powers as he may
think fit to any other Member or any officer of the State Bench
or Area Benches, subject to the condition that such Member or
officer shall, while exercising such delegated powers, continue to
act under the direction, control and supervision of the State
President.

111
 115. Where an amount paid by the appellant under sub- Interest on refund
section (6) of section 107 or sub-section (8) of section 112 is of amount paid
for admission of
required to be refunded consequent to any order of the Appellate appeal.
Authority or of the Appellate Tribunal, interest at the rate specified
under section 56 shall be payable in respect of such refund
from the date of payment of the amount till the date of refund of
such amount.

116. (1) Any person who is entitled or required to appear Appearance by

before an officer appointed under this Act, or the Appellate authorised
representative.
Authority or the Appellate Tribunal in connection with any
proceedings under this Act, may, otherwise than when required
under this Act to appear personally for examination on oath or
affirmation, subject to the other provisions of this section, appear by
an authorised representative.

(2) For the purposes of this Act, the expression ―authorised

representative‖ shall mean a person authorized by the person
referred to in sub-section (1) to appear on his behalf, being—

(a) his relative or regular employee; or

(b) an advocate who is entitled to practice in any court in

India, and who has not been debarred from practicing before any
court in India; or

(c) any chartered accountant, a cost accountant or a

company secretary, who holds a certificate of practice and who has
not been debarred from practice; or

(d) a retired officer of the Commercial Tax Department of

any State Government or Union territory or of the Board who,
during his service under the Government, had worked in a post
not below the rank than that of a Group-B Gazette Officer for a
period of not less than two years:

Provided that such officer shall not be entitled to appear

before any proceedings under this Act for a period of one year from
the date of his retirement or resignation; or

(e) Any person who has been authorized to act as a

goods and services tax practitioner on behalf of the concerned
registered person.

(3) No person,—

(a) who has been dismissed or removed from

Government service; or

(b) who is convicted of an offence connected with any

proceedings under this Act, the Central Goods and Services Tax
Act, the Integrated Goods and Services Tax Act or the Union
Territory Goods and Services Tax Act, or under the existing law
or under any of the Acts passed by a State Legislature dealing with

112
 the imposition of taxes on sale of goods or supply of goods or
services or both; or

(c) who is found guilty of misconduct by the prescribed

authority;

(d) who has been adjudged as an insolvent,

shall be qualified to represent any person under sub-section (1)—

(i) for all times in case of persons referred to in clauses

(a), (b) and (c); and

(ii) for the period during which the insolvency continues in

the case of a person referred to in clause (d).

(4) Any person who has been disqualified under the provisions
of the Central Goods and Services Tax Act or the Goods and
Services Tax Act of any other State or the Union Territory Goods
and Services Tax Act shall be deemed to be disqualified under this
Act.

Appeal to High
Court.
117. (1) Any person aggrieved by any order passed by the
State Bench or Area Benches of the Appellate Tribunal may file an
appeal to the High Court and the High Court may admit such
appeal, if it is satisfied that the case involves a substantial question
of law.

(2) An appeal under sub-section (1) shall be filed within a

period of one hundred and eighty days from the date on which the
order appealed against is received by the aggrieved person and it
shall be in such form, verified in such manner as may be
prescribed:

Provided that the High Court may entertain an appeal

after the expiry of the said period if it is satisfied that there was
sufficient cause for not filing it within such period.

(3) Where the High Court is satisfied that a substantial

question of law is involved in any case, it shall formulate that
question and the appeal shall be heard only on the question so
formulated, and the respondents shall, at the hearing of the appeal,
be allowed to argue that the case does not involve such question:

Provided that nothing in this sub-section shall be deemed

to take away or abridge the power of the court to hear, for reasons
to be recorded, the appeal on any other substantial question of law
not formulated by it, if it is satisfied that the case involves such
question.

(4) The High Court shall decide the question of law so

formulated and deliver such judgment thereon containing the
grounds on which such decision is founded and may award such
cost as it deems fit.

113
 (5) The High Court may determine any issue which—

(a) has not been determined by the State Bench or Area

Benches; or

(b) has been wrongly determined by the State Bench or

Area Benches, by reason of a decision on such question of law as
herein referred to in sub-section (3).

(6) Where an appeal has been filed before the High Court, it
shall be heard by a Bench of not less than two Judges of the High
Court, and shall be decided in accordance with the opinion of such
Judges or of the majority, if any, of such Judges.

(7) Where there is no such majority, the Judges shall state

the point of law upon which they differ and the case shall, then, be
heard upon that point only, by one or more of the other Judges of
the High Court and such point shall be decided according to the
opinion of the majority of the Judges who have heard the case
including those who first heard it.

(8) Where the High Court delivers a judgment in an appeal

filed before it under this section, effect shall be given to such
judgment by either side on the basis of a certified copy of the
judgment.

(9) Save as otherwise provided in this Act, the provisions of

Central Act 5 of the Code of Civil Procedure, 1908, relating to appeals to the High
1908 Court shall, as far as may be, apply in the case of appeals under
this section.

118. (1) An appeal shall lie to the Supreme Court— Appeal to Supreme
Court.
(a) from any order passed by the National Bench or
Regional Benches of the Appellate Tribunal; or

(b) from any judgment or order passed by the High Court

in an appeal made under section 117 in any case which, on its own
motion or on an application made by or on behalf of the party
aggrieved, immediately after passing of the judgment or order, the
High Court certifies to be a fit one for appeal to the Supreme
Court.

Central Act 5 of (2) The provisions of the Code of Civil Procedure, 1908,
1908 relating to appeals to the Supreme Court shall, so far as may be,
apply in the case of appeals under this section as they apply in the
case of appeals from decrees of a High Court.

(3) Where the judgment of the High Court is varied or reversed

in the appeal, effect shall be given to the order of the Supreme
Court in the manner provided in section 117 in the case of a
judgment of the High Court.

114
Sums due to be 119. Notwithstanding that an appeal has been preferred to the
paid High Court or the Supreme Court, sums due to the Government as
notwithstanding
appeal, etc. a result of an order passed by the National or Regional Benches of
the Appellate Tribunal under sub-section (1) of section 113 or an
order passed by the State Bench or Area Benches of the Appellate
Tribunal under sub-section (1) of section 113 or an order passed by
the High Court under section 117, as the case may be, shall be
payable in accordance with the order so passed.

Appeal not to be 120. (1) The Commissioner may, on the recommendations of

filed in certain the Council, from time to time, issue orders or instructions or
cases.
directions fixing such monetary limits, as he may deem fit, for the
purposes of regulating the filing of appeal or application by the
officer of the State tax under the provisions of this Chapter.

(2) Where, in pursuance of the orders or instructions or

directions issued under sub-section (1), the officer of the State tax
has not filed an appeal or application against any decision or order
passed under the provisions of this Act, it shall not preclude such
officer of the State tax from filing appeal or application in any other
case involving the same or similar issues or questions of law.

(3) Notwithstanding the fact that no appeal or application has

been filed by the officer of the State tax pursuant to the orders or
instructions or directions issued under sub-section (1), no person,
being a party in appeal or application shall contend that the officer
of the State tax has acquiesced in the decision on the disputed
issue by not filing an appeal or application.

(4) The Appellate Tribunal or court hearing such appeal or

application shall have regard to the circumstances under which
appeal or application was not filed by the officer of the State tax in
pursuance of the orders or instructions or directions issued under
sub-section(1).

Non appealable 121. Notwithstanding anything to the contrary in any

decisions and
orders. provisions of this Act, no appeal shall lie against any decision
taken or order passed by an officer of State tax if such decision
taken or order passed relates to any one or more of the
following matters, namely:—

(a) an order of the Commissioner or other authority

empowered to direct transfer of proceedings from one officer to
another officer; or

(b) an order pertaining to the seizure or retention of books

of account, register and other documents; or

(c) an order sanctioning prosecution under this Act; or

(d) an order passed under section 80.

115
 CHAPTER XIX.
OFFENCES AND PENALTIES.

122. (1) Where a taxable person who— Penalty for certain

offences
(i) supplies any goods or services or both without issue of
any invoice or issues an incorrect or false invoice with regard to any
such supply;

(ii) issues any invoice or bill without supply of goods or

services or both in violation of the provisions of this Act or the rules
made thereunder;

(iii) collects any amount as tax but fails to pay the same
to the Government beyond a period of three months from the date
on which such payment becomes due;

(iv) collects any tax in contravention of the provisions of

this Act but fails to pay the same to the Government beyond a
period of three months from the date on which such payment
becomes due;

(v) fails to deduct the tax in accordance with the provisions

of sub-section (1) of section 51, or deducts an amount which is less
than the amount required to be deducted under the said sub-
section, or where he fails to pay to the Government under sub-
section (2) thereof, the amount deducted as tax;

(vi) fails to collect tax in accordance with the provisions of

sub- section (1) of section 52, or collects an amount which is less
than the amount required to be collected under the said sub-
section or where he fails to pay to the Government the amount
collected as tax under sub-section (3) of section 52;

(vii) takes or utilizes input tax credit without actual receipt

of goods or services or both either fully or partially, in contravention
of the provisions of this Act or the rules made thereunder;

(viii) fraudulently obtains refund of tax under this Act;

(ix) takes or distributes input tax credit in contravention of

section 20, or the rules made thereunder;

(x) falsifies or substitutes financial records or produces

fake accounts or documents or furnishes any false information or
return with an intention to evade payment of tax due under this Act;

(xi) is liable to be registered under this Act but fails to

obtain Registration;

(xii) furnishes any false information with regard to

registration particulars, either at the time of applying for registration,
or subsequently;

(xiii) obstructs or prevents any officer in discharge of his

duties under this Act;

(xiv) transports any taxable goods without the cover of

documents as may be specified in this behalf;

116
 (xv) suppresses his turnover leading to evasion of tax
under this Act;

(xvi) fails to keep, maintain or retain books of account and

other documents in accordance with the provisions of this Act or the
rules made thereunder;

(xvii) fails to furnish information or documents called for by

an officer in accordance with the provisions of this Act or the rules
made thereunder or furnishes false information or documents
during any proceedings under this Act;

(xviii) supplies, transports or stores any goods which he

has reasons to believe are liable to confiscation under this Act;

(xix) issues any invoice or document by using the

registration number of another registered person;

(xx) tampers with, or destroys any material evidence or

documents;

(xxi) disposes off or tampers with any goods that have

been detained, seized, or attached under this Act,

he shall be liable to pay a penalty of ten thousand rupees or

an amount equivalent to the tax evaded or the tax not deducted
under section 51 or short deducted or deducted but not paid to the
Government or tax not collected under section 52 or short collected
or collected but not paid to the Government or input tax credit
availed of or passed on or distributed irregularly, or the refund
claimed fraudulently, whichever is higher.
1
[(1A) Any person who retains the benefit of a transaction
covered under clauses (i), (ii), (vii) or clause (ix) of sub-section (1)
and at whose instance such transaction is conducted, shall be
liable to a penalty of an amount equivalent to the tax evaded or
input tax credit availed of or passed on.]

(2) Any registered person who supplies any goods or services

or both on which any tax has not been paid or short-paid or
erroneously refunded, or where the input tax credit has been
wrongly availed or utilized,—

(a) for any reason, other than the reason of fraud or any
wilful misstatement or suppression of facts to evade tax, shall be
liable to a penalty of ten thousand rupees or ten per cent. of the
tax due from such person, whichever is higher;

(b) for reason of fraud or any wilful misstatement or

suppression of facts to evade tax, shall be liable to a penalty equal
to ten thousand rupees or the tax due from such person, whichever
is higher.

(3) Any person who—

(a) aids or abets any of the offences specified in
clauses (i) to (xxi) of sub-section (1);
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Inserted vide TN Act 29 of 2020 dated 19.10.2020 w.e.f 01.01.2021

117
 (b) acquires possession of, or in any way concerns
himself in transporting, removing, depositing, keeping, concealing,
supplying, or purchasing or in any other manner deals with any
goods which he knows or has reasons to believe are liable to
confiscation under this Act or the rules made thereunder;

(c) receives or is in any way concerned with the supply

of, or in any other manner deals with any supply of services
which he knows or has reasons to believe are in contravention of
any provisions of this Act or the rules made thereunder;

(d) fails to appear before the officer of State tax, when

issued with a summon for appearance to give evidence or
produce a document in an inquiry;

(e) fails to issue invoice in accordance with the

provisions of this Act or the rules made thereunder or fails to
account for an invoice in his books of account,

shall be liable to a penalty which may extend to twenty five

thousand rupees.

123. If a person who is required to furnish an information Penalty for failure to

return under section 150 fails to do so within the period specified in furnish
information
the notice issued under sub-section (3) thereof, the proper officer return.
may direct, that such person shall be liable to pay a penalty of one
hundred rupees for each day of the period during which the failure
to furnish such return continues:

Provided that the penalty imposed under this section shall not
exceed five thousand rupees.

124. If any person required to furnish any information or return Fine for failure to
under section151,— furnish statistics.

(a) without reasonable cause fails to furnish such

information or return as may be required under that section, or

(b) wilfully furnishes or causes to furnish any information or

return which he knows to be false,

he shall be punishable with a fine which may extend to ten

thousand rupees and in case of a continuing offence to a further
fine which may extend to one hundred rupees for each day after
the first day during which the offence continues subject to a
maximum limit of twenty five thousand rupees.

125. Any person, who contravenes any of the provisions of this General penalty.
Act or any rules made thereunder for which no penalty is separately
provided for in this Act, shall be liable to a penalty which may
extend to twenty five thousand rupees.

118
General disciplines 126. (1) No officer under this Act shall impose any penalty for
related to
minor breaches of tax regulations or procedural requirements and
penalty.
in particular, any omission or mistake in documentation which is
easily rectifiable and made without fraudulent intent or gross
negligence.

Explanation.—For the purpose of this sub-section,—

(a) a breach shall be considered a ‗minor breach‘ if the

amount of tax involved is less than five thousand rupees;

(b) an omission or mistake in documentation shall be

considered to be easily rectifiable if the same is an error apparent
on the face of record.

(2) The penalty imposed under this Act shall depend on the
facts and circumstances of each case and shall commensurate with
the degree and severity of the breach.

(3) No penalty shall be imposed on any person without giving

him an opportunity of being heard.

(4) The officer under this Act shall while imposing penalty in
an order for a breach of any law, regulation or procedural
requirement, specify the nature of the breach and the applicable
law, regulation or procedure under which the amount of penalty for
the breach has been specified.

(5) When a person voluntarily discloses to an officer under

this Act the circumstances of a breach of the tax law, regulation or
procedural requirement prior to the discovery of the breach by the
officer under this Act, the proper officer may consider this fact as a
mitigating factor when quantifying a penalty for that person.

(6) The provisions of this section shall not apply in such cases
where the penalty specified under this Act is either a fixed sum
or expressed as a fixed percentage.

Power to impose 127. Where the proper officer is of the view that a person is
penalty in
liable to a penalty and the same is not covered under any
certain cases.
proceedings under section 62 or section 63 or section 64 or
section 73 or section 74 or section 129 or section 130, he may
issue an order levying such penalty after giving a reasonable
opportunity of being heard to such person.

Power to waive 128. The Government may, by notification, waive in part or full,
penalty or fee or any penalty referred to in section 122 or section 123 or section 125
both.
or any late fee referred to in section 47 for such class of taxpayers
and under such mitigating circumstances as may be specified
therein on the recommendations of the Council.

Detention, seizure 129. (1) Notwithstanding anything contained in this Act, where
and release of
any person transports any goods or stores any goods while they
goods and
conveyances in are in transit in contravention of the provisions of this Act or the
transit. rules made thereunder, all such goods and conveyance used as a

119
means of transport for carrying the said goods and documents
relating to such goods and conveyance shall be liable to detention
or seizure and after detention or seizure, shall be released,—
(a) On payment of the applicable tax and penalty equal to
one hundred per cent. of the tax payable on such goods and, in
case of exempted goods, on payment of an amount equal to two
per cent. of the value of goods or twenty five thousand rupees,
whichever is less, where the owner of the goods comes forward for
payment of such tax and penalty;
(b) On payment of the applicable tax and penalty equal to
the fifty per cent. of the value of the goods reduced by the tax
amount paid thereon and, in case of exempted goods, on payment
of an amount equal to five per cent. of the value of goods or twenty
five thousand rupees, whichever is less, where the owner of the
goods does not come forward for payment of such tax and
penalty;
(c) upon furnishing a security equivalent to the amount
payable under clause (a) or clause (b) in such form and manner as
may be prescribed:
Provided that no such goods or conveyance shall be detained
or seized without serving an order of detention or seizure on the
person transporting the goods.
(2) The provisions of sub-section (6) of section 67 shall,
mutatis mutandis, apply for detention and seizure of goods and
conveyances.
(3) The proper officer detaining or seizing goods or
conveyances shall issue a notice specifying the tax and penalty
payable and thereafter, pass an order for payment of tax and
penalty under clause (a) or clause (b) or clause (c).
(4) No tax, interest or penalty shall be determined under sub-
section (3) without giving the person concerned an opportunity of
being heard.
(5) On payment of amount referred in sub-section (1), all
proceedings in respect of the notice specified in sub-section (3)
shall be deemed to be concluded.
(6) Where the person transporting any goods or the owner of
the goods fails to pay the amount of tax and penalty as provided
1
in sub-section (1) within [fourteen days] of such detention or
seizure, further proceedings shall be initiated in accordance with
the provisions of section130:
Provided that where the detained or seized goods are
perishable or hazardous in nature or are likely to depreciate in
2
value with passage of time, the said period of [fourteen days] may
be reduced by the proper officer.

-----------------------------------------------------------------------------------------
1
Substituted for ―seven days‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019
2
Substituted for ―seven days‖, by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019

120
Confiscation of 130. (1) Notwithstanding anything contained in this Act, if any
goods or
conveyances person—
and levy of
penalty.
(i) supplies or receives any goods in contravention of any
of the provisions of this Act or the rules made thereunder with intent
to evade payment of tax; or

(ii) does not account for any goods on which he is

liable to pay tax under this Act; or

(iii) supplies any goods liable to tax under this Act without
having applied for registration; or

(iv) contravenes any of the provisions of this Act or the

rules made thereunder with intent to evade payment of tax; or

(v) uses any conveyance as a means of transport for

carriage of goods in contravention of the provisions of this Act or
the rules made thereunder unless the owner of the conveyance
proves that it was so used without the knowledge or connivance of
the owner himself, his agent, if any, and the person in charge of the
conveyance, then, all such goods or conveyances shall be liable to
confiscation and the person shall be liable to penalty under
section122.

(2) Whenever confiscation of any goods or conveyance is

authorised by this Act, the officer adjudging it shall give to the
owner of the goods an option to pay in lieu of confiscation, such
fine as the said officer thinks fit:

Provided that such fine leviable shall not exceed the market
value of the goods confiscated, less the tax chargeable thereon:

Provided further that the aggregate of such fine and penalty

leviable shall not be less than the amount of penalty leviable under
sub-section (1) of section 129:

Provided also that where any such conveyance is used for

the carriage of the goods or passengers for hire, the owner of the
conveyance shall be given an option to pay in lieu of the
confiscation of the conveyance a fine equal to the tax payable on
the goods being transported thereon.

(3) Where any fine in lieu of confiscation of goods or

conveyance is imposed under sub-section (2), the owner of such
goods or conveyance or the person referred to in sub-section (1),
shall, in addition, be liable to any tax , penalty and charges
payable in respect of such goods or conveyance.

(4) No order for confiscation of goods or conveyance or for

imposition of penalty shall be issued without giving the person an
opportunity of being heard.

(5) Where any goods or conveyance are confiscated under

this Act, the title of such goods or conveyance shall thereupon vest
in the Government.

121
 (6) The proper officer adjudging confiscation shall take and
hold possession of the things confiscated and every officer of
Police, on the requisition of such proper officer, shall assist him in
taking and holding such possession.

(7) The proper officer may, after satisfying himself that the
confiscated goods or conveyance are not required in any other
proceedings under this Act and after giving reasonable time not
exceeding three months to pay fine in lieu of confiscation, dispose
of such goods or conveyance and deposit the sale proceeds
thereof with the Government.

131. Without prejudice to the provisions contained in the Code Confiscation or

Central Act 2 of of Criminal Procedure, 1973, no confiscation made or penalty penalty not to
1974 interfere with
imposed under the provisions of this Act or the rules made other
thereunder shall prevent the infliction of any other punishment to punishments.
which the person affected thereby is liable under the provisions of
this Act or under any other law for the time being in force.

1 Punishment for
132. (1) [Whoever commits, or causes to commit and retain
certain offences.
the benefits arising out of, any of the following offences] namely:—
(a) supplies any goods or services or both without issue
of any invoice, in violation of the provisions of this Act or the rules
made thereunder, with the intention to evade tax;
(b) issues any invoice or bill without supply of goods or
services or both in violation of the provisions of this Act, or the rules
made thereunder leading to wrongful availment or utilization of input
tax credit or refund of tax;
2
[(c) avails input tax credit using the invoice or bill referred
to in clause (b) or fraudulently avails input tax credit without any
invoice or bill;]

(d) collects any amount as tax but fails to pay the same to
the Government beyond a period of three months from the date on
which such payment becomes due;
3
(e) evades tax, [*****] or fraudulently obtains refund and
where such offence is not covered under clauses (a) to (d);

(f) falsifies or substitutes financial records or produces fake

accounts or documents or furnishes any false information with an
intention to evade payment of tax due under this Act;

(g) obstructs or prevents any officer in the discharge of his

duties under this Act;
------------------------------------------------------------------------------------------------------------
1
Substituted for ―Whoever commits any of the following offences‖ by TN Act 29 of
2020 dated 19.10.2020 w.e.f 01.01.2021
2
Substituted for ―avails input tax credit using such invoice or bill referred to in
clause (b); by TN Act 29 of 2020 dated 19.10.2020 w.e.f 01.01.2021
3
Omitted ‖the expression [fraudulently avails input tax credit] vide TN Act 29 of
2020 dated 19.10.2020 w.e.f 01.01.2021

122
 (h) acquires possession of, or in any way concerns himself
in transporting, removing, depositing, keeping, concealing,
supplying, purchasing or in any other manner deals with, any goods
which he knows or has reasons to believe are liable to confiscation
under this Act or the rules made thereunder;
(i) receives or is in any way concerned with the supply
of, or in any other manner deals with any supply of services
which he knows or has reasons to believe are in contravention of
any provisions of this Act or the rules made thereunder;
(j) tampers with or destroys any material evidence or
documents;
(k) fails to supply any information which he is required to
supply under this Act or the rules made thereunder or (unless with a
reasonable belief, the burden of proving which shall be upon him,
that the information supplied by him is true) supplies false
information; or

(l) attempts to commit, or abets the commission of any of

the offences mentioned in clauses (a) to (k) of this section,

shall be punishable—

(i) in cases where the amount of tax evaded or the

amount of input tax credit wrongly availed or utilized or the amount
of refund wrongly taken exceeds five hundred lakh rupees, with
imprisonment for a term which may extend to five years and with
fine;

(ii) in cases where the amount of tax evaded or the

amount of input tax credit wrongly availed or utilized or the
amount of refund wrongly taken exceeds two hundred lakh rupees
but does not exceed five hundred lakh rupees, with imprisonment
for a term which may extend to three years and with fine;

(iii) in the case of any other offence where the amount of

tax evaded or the amount of input tax credit wrongly availed or
utilised or the amount of refund wrongly taken exceeds one
hundred lakh rupees but does not exceed two hundred lakh rupees,
with imprisonment for a term which may extend to one year and
with fine;

(iv) in cases where he commits or abets the commission

of an offence specified in clause (f) or clause (g) or clause (j), he
shall be punishable with imprisonment for a term which may
extend to six months or with fine or with both.

(2) Where any person convicted of an offence under this

section is again convicted of an offence under this section, then, he
shall be punishable for the second and for every subsequent
offence with imprisonment for a term which may extend to five
years and with fine.

123
 (3) The imprisonment referred to in clauses (i), (ii) and (iii) of
sub-section (1) and sub-section (2) shall, in the absence of special
and adequate reasons to the contrary to be recorded in the
judgment of the Court, be for a term not less than six months.

Central Act 2 of (4) Notwithstanding anything contained in the Code of

1974 Criminal Procedure, 1973, all offences under this Act, except the
offences referred to in sub-section (5) shall be non-cognizable and
bailable.

(5) The offences specified in clause (a) or clause (b) or clause

(c) or clause (d) of sub-section (1) and punishable under clause (i)
of that sub- section shall be cognizable and non-bailable.

(6) A person shall not be prosecuted for any offence under

this section except with the previous sanction of the Commissioner.

Explanation.— For the purposes of this section, the term ―tax‖ shall
include the amount of tax evaded or the amount of input tax credit
wrongly availed or utilised or refund wrongly taken under the
provisions of this Act, the Central Goods and Services Tax Act, the
Integrated Goods and Services Tax Act, and cess levied under the
Goods and Services Tax (Compensation to States) Act.

133. (1) Where any person engaged in connection with the Liability of officers
collection of statistics under section 151 or compilation or and certain
other persons.
computerization thereof or if any officer of State tax having access
to information specified under sub-section (1) of section 150, or if
any person engaged in connection with the provision of service on
the common portal or the agent of common portal, willfully discloses
any information or the contents of any return furnished under this
Act or rules made thereunder otherwise than in execution of his
duties under the said sections or for the purposes of prosecution for
an offence under this Act or under any other Act for the time being
in force, he shall be punishable with imprisonment for a term which
may extend to six months or with fine which may extend to twenty
five thousand rupees, or with both.

(2) Any person—

(a) who is a Government servant shall not be prosecuted

for any offence under this section except with the previous sanction
of the Government;

(b) Who is not a Government servant shall not be

prosecuted for any offence under this section except with the
previous sanction of the Commissioner.

134. No court shall take cognizance of any offence punishable Cognizance of

offences.
under this Act or the rules made thereunder except with the
previous sanction of the Commissioner, and no court inferior to
that of a Magistrate of the First Class, shall try any such offence.

124
Presumption of 135. In any prosecution for an offence under this Act which
culpable mental
state.
requires a culpable mental state on the part of the accused, the
court shall presume the existence of such mental state but it shall
be a defense for the accused to prove the fact that he had no such
mental state with respect to the act charged as an offence in that
prosecution.

Explanation.—For the purposes of this section,—

(i) the expression ―culpable mental state‖ includes

intention, motive, knowledge of a fact, and belief in, or reason to
believe, a fact;

(ii) A fact is said to be proved only when the court

believes it to exist beyond reasonable doubt and not merely when
its existence is established by a preponderance of probability.

Relevancy of 136. A statement made and signed by a person on

statements
under certain
appearance in response to any summons issued under section 70
circumstances. during the course of any inquiry or proceedings under this Act shall
be relevant, for the purpose of proving, in any prosecution for an
offence under this Act, the truth of the facts which it contains,—

(a) when the person who made the statement is dead or

cannot be found, or is incapable of giving evidence, or is kept
out of the way by the adverse party, or whose presence cannot
be obtained without an amount of delay or expense which, under
the circumstances of the case, the court considers unreasonable; or

(b) When the person who made the statement is examined as

a witness in the case before the court and the court is of the opinion
that, having regard to the circumstances of the case, the statement
should be admitted in evidence in the interest of justice.

Offences by 137. (1) Where an offence committed by a person under this

Companies.
Act is a company, every person who, at the time the offence was
committed was in charge of, and was responsible to, the company
for the conduct of business of the company, as well as the
company, shall be deemed to be guilty of the offence and shall
be liable to be proceeded against and punished accordingly.

(2) Notwithstanding anything contained in sub-section (1),

where an offence under this Act has been committed by a
company and it is proved that the offence has been committed
with the consent or connivance of, or is attributable to any
negligence on the part of, any director, manager, secretary or other
officer of the company, such director, manager, secretary or other
officer shall also be deemed to be guilty of that offence and shall
be liable to be proceeded against and punished accordingly.

(3) Where an offence under this Act has been committed by a

taxable person being a partnership firm or a Limited Liability
Partnership or a Hindu Undivided Family or a trust, the partner or

125
Karta or managing trustee shall be deemed to be guilty of that
offence and shall be liable to be proceeded against and punished
accordingly and the provisions of sub-section (2) shall mutatis
mutandis apply to such persons.

(4) Nothing contained in this section shall render any such

person liable to any punishment provided in this Act, if he proves
that the offence was committed without his knowledge or that he
had exercised all due diligence to prevent the commission of such
offence.

Explanation.— For the purposes of this section,—

(i) ―company‖ means a body corporate and includes a firm

or other association of individuals; and

(ii) ―director‖, in relation to a firm, means a partner in the

firm.

138. (1) Any offence under this Act may, either before or after Compounding of
the institution of prosecution, be compounded by the Commissioner offences.

on payment, by the person accused of the offence, to the Central

Government or the State Government, as the case may be, of such
compounding amount in such manner as may be prescribed:

Provided that nothing contained in this section shall apply

to—

(a) a person who has been allowed to compound once in

respect of any of the offences specified in clauses (a) to (f) of sub-
section (1) of section 132 and the offences specified in clause (l)
which are relatable to offences specified in clauses (a) to (f) of the
said sub-section;

(b) a person who has been allowed to compound once in

respect of any offence, other than those in clause (a), under this Act
or under the provisions of any State Goods and Services Tax Act
or the Central Goods and Services Tax Act or the Union Territory
Goods and Services Tax Act or the Integrated Goods and Services
Tax Act in respect of supplies of value exceeding one Crore rupees

(c) a person who has been accused of committing an offence

under this Act which is also an offence under any other law for the
time being in force;

(d) a person who has been convicted for an offence under

this Act by a court;

(e) a person who has been accused of committing an offence

specified in clause (g) or clause (j) or clause (k) of sub-section (1)
of section 132; and

(f) any other class of persons or offences as may be

prescribed:

126
 Provided further that any compounding allowed under the
provisions of this section shall not affect the proceedings, if any,
instituted under any other law:

Provided also that compounding shall be allowed only after

making payment of tax, interest and penalty involved in such
offences.

(2) The amount for compounding of offences under this

section shall be such as may be prescribed, subject to the minimum
amount not being less than ten thousand rupees or fifty per cent. of
the tax involved, whichever is higher, and the maximum amount
not being less than thirty thousand rupees or one hundred and fifty
per cent. of the tax, whichever is higher.

(3) On payment of such compounding amount as may be

determined by the Commissioner, no further proceedings shall be
initiated under this Act against the accused person in respect of the
same offence and any criminal proceedings, if already initiated in
respect of the said offence, shall stand abated.

CHAPTER XX.
TRANSITIONAL PROVISIONS.

Migration of 139. (1) On and from the appointed day, every person
existing
taxpayers.
registered under any of the existing laws and having a valid
Permanent Account Number shall be issued a certificate of
registration on provisional basis, subject to such conditions and in
such form and manner as may be prescribed, which unless
replaced by a final certificate of registration under sub-section (2),
shall be liable to be cancelled if the conditions so prescribed are not
complied with.

(2) The final certificate of registration shall be granted in such

form and manner and subject to such conditions as may be
prescribed.

(3) The certificate of registration issued to a person under

sub-section (1) shall be deemed to have not been issued if the said
registration is cancelled in pursuance of an application filed by such
person that he was not liable to registration under section 22 or
section 24.

Transitional 140. (1) A registered person, other than a person opting to pay
arrangements
for input tax
tax under section 10, shall be entitled to take, in his electronic
credit credit ledger, credit of the amount of value added tax and entry
tax, if any, carried forward in the return relating to the period
ending with the day immediately preceding the appointed day,
1
furnished by him under the existing law [within such time and] in
such manner as may be prescribed:
--------------------------------------------------------------------------------------
1
Inserted vide TN Act 29 of 2020 dated 19.10.2020 w.e.f 01.07.2017

127
 Provided that the registered person shall not be allowed to
take credit in the following circumstances, namely:—

(i) where the said amount of credit is not admissible as

input tax credit under this Act; or

(ii) where he has not furnished all the returns required

under the existing law for the period of six months immediately
preceding the appointed date: or

Provided further that so much of the said credit as is

attributable to any claim related to section 3, sub-section (3) of
section 5, section 6, section 6A or sub-section (8) of section 8 of
Central Act 74 of the Central Sales Tax Act, 1956 which is not substantiated in the
1956.
manner, and within the period, prescribed in rule 12 of the Central
Sales Tax (Registration and Turnover) Rules, 1957 shall not be
eligible to be credited to the electronic credit ledger:

Provided also that an amount equivalent to the credit

specified in the second proviso shall be refunded under the existing
law when the said claims are substantiated in the manner
prescribed in rule 12 of the Central Sales Tax (Registration and
Turnover) Rules, 1957.

(2) A registered person, other than a person opting to pay tax

under section 10, shall be entitled to take, in his electronic credit
ledger, credit of the un availed input tax credit in respect of capital
goods, not carried forward in a return, furnished under the existing
law by him, for the period ending with the day immediately
1
preceding the appointed day [within such time and] in such manner
as may be prescribed:

Provided that the registered person shall not be allowed to

take credit unless the said credit was admissible as input tax credit
under the existing law and is also admissible as input tax credit
under this Act.

Explanation.— For the purposes of this section, the

expression ―un availed input tax credit‖ means the amount that
remains after subtracting the amount of input tax credit already
availed in respect of capital goods by the taxable person under the
existing law from the aggregate amount of input tax credit to
which the said person was entitled in respect of the said capital
goods under the existing law.

(3) A registered person, who was not liable to be registered

under the existing law or who was engaged in the sale of exempted
goods or tax free goods, by whatever name called, or goods
which have suffered tax at the first point of their sale in the State
and the subsequent sales of which are not subject to tax in the
State under the existing law but which are liable to tax under
----------------------------------------------------------------------------------------
1
Inserted vide TN Act 29 of 2020 dated 19.10.2020. w.e.f 01.07.2017

128
this Act or where the person was entitled to the credit of input tax
at the time of sale of goods, if any, shall be entitled to take, in his
electronic credit ledger, credit of the value added tax and entry tax
in respect of inputs held in stock and inputs contained in semi-
1
finished or finished [goods held in stock on the appointed day,
within such time and in such manner as may be prescribed subject
to] the following conditions, namely:—

(i) such inputs or goods are used or intended to be used

for making taxable supplies under this Act;

(ii) the said registered person is eligible for input tax credit
on such inputs under this Act;

(iii) the said registered person is in possession of invoice

or other prescribed documents evidencing payment of tax under the
existing law in respect of such inputs; and

(iv) such invoices or other prescribed documents were

issued not earlier than twelve months immediately preceding the
appointed day: and

Provided that where a registered person, other than a

manufacturer or a supplier of services, is not in possession of an
invoice or any other documents evidencing payment of tax in
respect of inputs, then, such registered person shall, subject to
such conditions, limitations and safeguards as may be prescribed,
including that the said taxable person shall pass on the benefit
of such credit by way of reduced prices to the recipient, be allowed
to take credit at such rate and in such manner as may be
prescribed.

(4) A registered person, who was engaged in the sale of

taxable goods as well as exempted goods or tax free goods, by
whatever name called, under the existing law but which are liable to
tax under this Act, shall be entitled to take, in his electronic credit
ledger,—
(a) the amount of credit of the value added tax and entry
tax, if any, carried forward in a return furnished under the existing
law by him in accordance with the provisions of sub-section (1); and
(b) the amount of credit of the value added tax and entry
tax, if any, in respect of inputs held in stock and inputs contained
in semi-finished or finished goods held in stock on the appointed
day, relating to such exempted goods or tax free goods, by
whatever name called, in accordance with the provisions of sub-
section (3).

----------------------------------------------------------------------------------------
1
Substituted for ―goods held in stock on the appointed day‖, by TN Act 29 of 2020
dated 19.10.2020 w.e.f 01.07.2017

129
 (5) A registered person shall be entitled to take, in his
electronic credit ledger, credit of value added tax and entry tax, if
any, in respect of inputs received on or after the appointed day but
the tax in respect of which has been paid by the supplier under the
1
[existing law, within such time and in such manner as may be
prescribed], subject to the condition that the invoice or any other
tax paying document of the same was recorded in the books of
account of such person within a period of thirty days from the
appointed day:

Provided that the period of thirty days may, on sufficient

cause being shown, be extended by the Commissioner for a further
period not exceeding thirty days:

Provided further that the said registered person shall furnish a

statement, in such manner as may be prescribed, in respect of
credit that has been taken under this sub-section.

(6) A registered person, who was either paying tax at a fixed

rate or paying a fixed amount in lieu of the tax payable under the
existing law shall be entitled to take, in his electronic credit ledger,
credit of value added tax in respect of inputs held in stock and
2
inputs contained in semi-finished or finished [goods held in stock
on the appointed day, within such time and in such manner as may
be prescribed, subject to] the following conditions, namely:—

(i) such inputs or goods are used or intended to be used

for making taxable supplies under this Act;

(ii) the said registered person is not paying tax under

section10;

(iii) the said registered person is eligible for input tax

credit on such inputs under this Act;

(iv) the said registered person is in possession of invoice

or other prescribed documents evidencing payment of tax under the
existing law in respect of inputs; and
(v) such invoices or other prescribed documents were
issued not earlier than twelve months immediately preceding the
appointed day.

(7) The amount of credit under sub-sections (3), (4) and (6)
shall be calculated in such manner as may be prescribed.

141. (1) Where any inputs received at a place of business had Transitional
provisions
been dispatched as such or dispatched after being partially
relating to job
processed to a job worker for further processing, testing, repair, work.
reconditioning or any other purpose in accordance with the
----------------------------------------------------------------------------------------
1
Substituted for ―existing law‖, by TN Act 29 of 2020 dated 19.10.2020 w.e.f
01.07.2017
2
Substituted for ―goods held in stock on the appointed day‖, by TN Act 29 of 2020
dated 19.10.2020 w.e.f 01.07.2017

130
provisions of existing law prior to the appointed day and such
inputs are returned to the said place on or after the appointed day,
no tax shall be payable if such inputs, after completion of the job
work or otherwise, are returned to the said place within six months
from the appointed day:

Provided that the period of six months may, on sufficient

cause being shown, be extended by the Commissioner for a further
period not exceeding two months:

Provided further that if such inputs are not returned within the
period specified in this sub-section, the input tax credit shall be
liable to be recovered in accordance with the provisions of clause
(a) of sub-section (8) of section 142.

(2) Where any semi-finished goods had been dispatched from

the place of business to any other premises for carrying out certain
manufacturing processes in accordance with the provisions of
existing law prior to the appointed day and such goods (hereafter in
this sub-section referred to as ―the said goods‖) are returned to the
said place on or after the appointed day, no tax shall be payable if
the said goods, after undergoing manufacturing processes or
otherwise, are returned to the said place within six months from the
appointed day:

Provided that the period of six months may, on sufficient

cause being shown, be extended by the Commissioner for a further
period not exceeding two months:

Provided further that if the said goods are not returned within
a period specified in this sub-section, the input tax credit shall be
liable to be recovered in accordance with the provisions of clause
(a) of sub-section (8) of section 142:

Provided also that the person dispatching the goods may, in

accordance with the provisions of the existing law, transfer the
said goods to the premises of any registered person for the
purpose of supplying therefrom on payment of tax in India or
without payment of tax for exports within the period specified in
this sub-section.
(3) Where any goods had been dispatched from the place of
business without payment of tax for carrying out tests or any other
process, to any other premises, whether registered or not, in
accordance with the provisions of existing law prior to the appointed
day and such goods are returned to the said place of business on
or after the appointed day, no tax shall be payable if the said goods,
after undergoing tests or any other process, are returned to such
place within six months from the appointed day:

Provided that the period of six months may, on sufficient

cause being shown, be extended by the Commissioner for a further
period not exceeding two months:

131
 Provided further that if the said goods are not returned within
the period specified in this sub-section, the input tax credit shall be
liable to be recovered in accordance with the provisions of clause
(a) of sub-section (8) of section 142:

Provided also that the person dispatching the goods may, in

accordance with the provisions of the existing law, transfer the said
goods from the said other premises on payment of tax in India or
without payment of tax for exports within the period specified in this
sub-section.

(4) The tax under sub-sections (1), (2) and (3) shall not be
payable, only if the person dispatching the goods and the job
worker declare the details of the inputs or goods held in stock by
the job worker on behalf of the said person on the appointed day in
such form and manner and within such time as may be prescribed.

142. (1) Where any goods on which tax, if any, had been paid Miscellaneous
transitional
under the existing law at the time of sale thereof, not being earlier provisions.
than six months prior to the appointed day, are returned to any
place of business on or after the appointed day, the registered
person shall be eligible for refund of the tax paid under the existing
law where such goods are returned by a person, other than a
registered person, to the said place of business within a period of
six months from the appointed day and such goods are identifiable
to the satisfaction of the proper officer:

Provided that if the said goods are returned by a registered

person, the return of such goods shall be deemed to be a supply.

(2) (a) Where, in pursuance of a contract entered into prior to

the appointed day, the price of any goods is revised upwards on or
after the appointed day, the registered person who had sold such
goods shall issue to the recipient a supplementary invoice or debit
note, containing such particulars as may be prescribed, within thirty
days of such price revision and for the purposes of this Act, such
supplementary invoice or debit note shall be deemed to have been
issued in respect of an outward supply made under this Act;

(b) Where, in pursuance of a contract entered into prior to

the appointed day, the price of any goods is revised downwards on
or after the appointed day, the registered person who had sold such
goods may issue to the recipient a credit note, containing such
particulars as may be prescribed, within thirty days of such price
revision and for the purposes of this Act such credit note shall be
deemed to have been issued in respect of an outward supply made
under this Act:

Provided that the registered person shall be allowed to

reduce his tax liability on account of issue of the credit note only if
the recipient of the credit note has reduced his input tax credit
corresponding to such reduction of tax liability.

132
 (3) Every claim for refund filed by any person before, on or
after the appointed day for refund of any amount of input tax
credit, tax, interest or any other amount paid under the existing law,
shall be disposed of in accordance with the provisions of existing
law and any amount eventually accruing to him shall be refunded to
him in cash in accordance with the provisions of the said law:

Provided that where any claim for refund of the amount of

input tax credit is fully or partially rejected, the amount so rejected
shall lapse:

Provided further that no refund shall be allowed of any

amount of input tax credit where the balance of the said amount as
on the appointed day has been carried forward under this Act.

(4) Every claim for refund filed after the appointed day for
refund of any tax paid under the existing law in respect of the
goods exported before or after the appointed day, shall be disposed
of in accordance with the provisions of the existing law:

Provided that where any claim for refund of input tax credit is
fully or partially rejected, the amount so rejected shall lapse:

Provided further that no refund shall be allowed of any

amount of input tax credit where the balance of the said amount as
on the appointed day has been carried forward under this Act.

(5) Notwithstanding anything to the contrary contained in this

Act, any amount of input tax credit reversed prior to the appointed
day shall not be admissible as input tax credit under this Act.

(6) (a) Every proceeding of appeal, revision, review or

reference relating to a claim for input tax credit initiated whether
before, on or after the appointed day under the existing law shall be
disposed of in accordance with the provisions of the existing law,
and any amount of credit found to be admissible to the claimant
shall be refunded to him in cash in accordance with the provisions
of the existing law, and the amount rejected, if any, shall not be
admissible as input tax credit under this Act:

Provided that no refund shall be allowed of any amount of

input tax credit where the balance of the said amount as on the
appointed day has been carried forward under this Act;

(b) Every proceeding of appeal, revision, review or reference

relating to recovery of input tax credit initiated whether before, on or
after the appointed day under the existing law shall be disposed of
in accordance with the provisions of the existing law, and if any
amount of credit becomes recoverable as a result of such appeal,
revision, review or reference, the same shall, unless recovered
under the existing law, be recovered as an arrear of tax under
this Act and the amount so recovered shall not be admissible as
input tax credit under this Act.

133
 (7) (a) Every proceeding of appeal, revision, review or
reference relating to any output tax liability initiated whether before,
on or after the appointed day under the existing law, shall be
disposed of in accordance with the provisions of the existing law,
and if any amount becomes recoverable as a result of such appeal,
revision, review or reference, the same shall, unless recovered
under the existing law, be recovered as an arrear of tax under this
Act and the amount so recovered shall not be admissible as input
tax credit under this Act.

(b) Every proceeding of appeal, revision, review or

reference relating to any output tax liability initiated whether before,
on or after the appointed day under the existing law, shall be
disposed of in accordance with the provisions of the existing law,
and any amount found to be admissible to the claimant shall be
refunded to him in cash in accordance with the provisions of the
existing law and the amount rejected, if any, shall not be admissible
as input tax credit under this Act.

(8) (a) Where in pursuance of an assessment or adjudication

proceedings instituted, whether before, on or after the appointed
day under the existing law, any amount of tax, interest, fine or
penalty becomes recoverable from the person, the same shall,
unless recovered under the existing law, be recovered as an arrear
of tax under this Act and the amount so recovered shall not be
admissible as input tax credit under this Act;

(b) Where in pursuance of an assessment or adjudication

proceedings instituted, whether before, on or after the appointed
day under the existing law, any amount of tax, interest, fine or
penalty becomes refundable to the taxable person, the same shall
be refunded to him in cash under the said law, and the amount
rejected, if any, shall not be admissible as input tax credit under
this Act

(9) (a) Where any return, furnished under the existing law, is
revised after the appointed day and if, pursuant to such revision,
any amount is found to be recoverable or any amount of input tax
credit is found to be inadmissible, the same shall, unless recovered
under the existing law, be recovered as an arrear of tax under this
Act and the amount so recovered shall not be admissible as input
tax credit under this Act;

(b) Where any return, furnished under the existing law, is

revised after the appointed day but within the time limit specified for
such revision under the existing law and if, pursuant to such
revision, any amount is found to be refundable or input tax credit is
found to be admissible to any taxable person, the same shall be
refunded to him in cash under the existing law, and the amount
rejected, if any, shall not be admissible as input tax credit under
this Act.

134
 (10) Save as otherwise provided in this Chapter, the goods or
services or both supplied on or after the appointed day in
pursuance of a contract entered into prior to the appointed day shall
be liable to tax under the provisions of this Act.

(11) (a) Notwithstanding anything contained in section 12,

no tax shall be payable on goods under this Act to the extent the
Tamil Nadu Act 32
tax was leviable on the said goods under the Tamil Nadu Value of 2006.
Added Tax Act, 2006;

(b) Notwithstanding anything contained in section 13, no tax

shall be payable on services under this Act to the extent the tax
was leviable on the said services under Chapter V of the Finance Central Act 32 of
Act,1994; 1994

(c) Where tax was paid on any supply, both under the Tamil
Tamil Nadu Act 32
Nadu Value Added Tax Act, 2006 and under Chapter V of the of 2006.
Finance Act, 1994, tax shall be leviable under this Act and the Central Act 32 of
taxable person shall be entitled to take credit of value added tax or 1994

service tax paid under the existing law to the extent of supplies
made after the appointed day and such credit shall be calculated in
such manner as may be prescribed.

(12) Where any goods sent on approval basis, not earlier

than six months before the appointed day, are rejected or not
approved by the buyer and returned to the seller on or after the
appointed day, no tax shall be payable thereon if such goods are
returned within six months from the appointed day:

Provided that the said period of six months may, on sufficient

cause being shown, be extended by the Commissioner for a further
period not exceeding two months:

Provided further that the tax shall be payable by the person

returning the goods if such goods are liable to tax under this Act,
and are returned after the period specified in this sub-section:

Provided also that tax shall be payable by the person who

has sent the goods on approval basis if such goods are liable to
tax under this Act, and are not returned within the period specified
in this sub-section.

(13) Where a supplier has made any sale of goods in respect

of which tax was required to be deducted at source under the Tamil Tamil Nadu Act 32
Nadu Value Added Tax Act, 2006 and has also issued an invoice of 2006.
for the same before the appointed day, no deduction of tax at
source under section 51 shall be made by the deductor under the
said section where payment to the said supplier is made on or after
the appointed day.

(14) Where any goods or capital goods belonging to the

principal are lying at the premises of the agent on the appointed
day, the agent shall be entitled to take credit of the tax paid on such
goods or capital goods subject to fulfillment of the following
conditions:

135
 (i) the agent is a registered taxable person under this
Act;

(ii) both the principal and the agent declare the details of
stock of goods or capital goods lying with such agent on the day
immediately preceding the appointed day in such form and manner
and within such time as may be prescribed in this behalf;

(iii) the invoices for such goods or capital goods had been
issued not earlier than twelve months immediately preceding the
appointed day; and

(iv) the principal has either reversed or not availed of the

input tax credit in respect of such,—

(a) goods; or

(b) Capital goods or, having availed of such credit, has

reversed the said credit, to the extent availed of by him.

Tamil Nadu Act 32 Explanation.—for the purposes of this Chapter, the

of 2006 expression ―capital goods‖ shall have the same meaning as
assigned to it in the Tamil Nadu Value Added Tax Act, 2006.

CHAPTER XXI.
MISCELLANEOUS.

143. (1) A registered person (hereafter in this section referred Job work
to as the ―principal‖) may, under intimation and subject to such procedure.

conditions as may be prescribed, send any inputs or capital goods,

without payment of tax, to a job worker for job work and from
there subsequently send to another job worker and likewise, and
shall,—

(a) bring back inputs, after completion of job work or

otherwise, or capital goods, other than moulds and dies, jigs and
fixtures, or tools, within one year and three years, respectively, of
their being sent out, to any of his place of business, without
payment of tax;

(b) supply such inputs, after completion of job work or

otherwise, or capital goods, other than moulds and dies, jigs and
fixtures, or tools, within one year and three years, respectively, of
their being sent out from the place of business of a job worker on
payment of tax within India, or with or without payment of tax for
export, as the case may be:

Provided that the principal shall not supply the goods from the
place of business of a job worker in accordance with the provisions
of this clause unless the said principal declares the place of
business of the job worker as his additional place of business
except in a case—

(i) where the job worker is registered under section 25; or

136
 (ii) where the principal is engaged in the supply of such
goods as may be notified by the Commissioner.
1
[Provided further that the period of one year and three years
may, on sufficient cause being shown, be extended by the
Commissioner for a further period not exceeding one year and two
years, respectively]
(2) The responsibility for keeping proper accounts for the
inputs or capital goods shall lie with the principal.
(3) Where the inputs sent for job work are not received back
by the principal after completion of job work or otherwise in
accordance with the provisions of clause (a) of sub-section (1) or
are not supplied from the place of business of the job worker in
accordance with the provisions of clause (b) of sub-section (1)
within a period of one year of their being sent out, it shall be
deemed that such inputs had been supplied by the principal to the
job worker on the day when the said inputs were sent out.
(4) Where the capital goods, other than moulds and dies, jigs
and fixtures, or tools, sent for job work are not received back by the
principal in accordance with the provisions of clause (a) of sub-
section (1) or are not supplied from the place of business of the job
worker in accordance with the provisions of clause (b) of sub-
section (1) within a period of three years of their being sent out, it
shall be deemed that such capital goods had been supplied by the
principal to the job worker on the day when the said capital goods
were sent out.
(5) Notwithstanding anything contained in sub-sections (1)
and (2), any waste and scrap generated during the job work may be
supplied by the job worker directly from his place of business on
payment of tax, if such job worker is registered, or by the principal,
if the job worker is not registered.
Explanation.— For the purposes of job work, input includes
intermediate goods arising from any treatment or process carried
out on the inputs by the principal or the job worker.

Presumption as to 144. Where any document—

documents in
certain cases. (i) is produced by any person under this Act or any other law
for the time being in force; or
(ii) has been seized from the custody or control of any person
under this Act or any other law for the time being in force; or
(iii) has been received from any place outside India in the
course of any proceedings under this Act or any other law for the
time being in force,
and such document is tendered by the prosecution in evidence
against him or any other person who is tried jointly with him, the
court shall—
--------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

137
 (a) unless the contrary is proved by such person, presume—
(i) the truth of the contents of such document;
(ii) that the signature and every other part of such document
which purports to be in the hand writing of any particular person or
which the court may reasonably assume to have been signed by, or
to be in the handwriting of, any particular person, is in that
person‘s handwriting, and in the case of a document executed or
attested, that it was executed or attested by the person by whom it
purports to have been so executed or attested;
(b) admit the document in evidence not withstanding that it is
not duly stamped, if such document is otherwise admissible in
evidence.

145. (1) Notwithstanding anything contained in any other law Admissibility of

for the time being in force, — micro films,
facsimile
(a) a micro film of a document or the reproduction of the copies of
documents and
image or images embodied in such micro film (whether enlarged or computer
not); or printouts as
documents and
(b) a facsimile copy of a document; or as evidence.
(c) a statement contained in a document and included in
a printed material produced by a computer, subject to such
conditions as may be prescribed; or
(d) any information stored electronically in any device or
media, including any hard copies made of such information,
shall be deemed to be a document for the purposes of this Act and
the rules made thereunder and shall be admissible in any
proceedings thereunder, without further proof or production of the
original, as evidence of any contents of the original or of any fact
stated therein of which direct evidence would be admissible.
(2) In any proceedings under this Act or the rules made
thereunder, where it is desired to give a statement in evidence by
virtue of this section, a certificate,—
(a) Identifying the document containing the statement and
describing the manner in which it was produced;
(b) giving such particulars of any device involved in the
production of that document as may be appropriate for the purpose
of showing that the document was produced by a computer,
shall be evidence of any matter stated in the certificate and for the
purposes of this sub-section it shall be sufficient for a matter to
be stated to the best of the knowledge and belief of the person
stating it.

146. The Government may, on the recommendations of the Common portal.

Council, notify the Common Goods and Services Tax Electronic
Portal for facilitating registration, payment of tax, furnishing of
returns, computation and settlement of integrated tax, electronic
way bill and for carrying out such other functions and for such
purposes as may be prescribed.

138
Deemed Exports. 147. The Government may, on the recommendations of the
Council, notify certain supplies of goods as ―deemed exports‖,
where goods supplied do not leave India, and payment for such
supplies is received either in Indian rupees or in convertible foreign
exchange, if such goods are manufactured in India.

Special procedure 148. The Government may, on the recommendations of the

for certain
processes. Council, and subject to such conditions and safeguards as may be
prescribed, notify certain classes of registered persons, and the
special procedures to be followed by such persons including those
with regard to registration, furnishing of return, payment of tax and
administration of such persons.

Goods and 149. (1) Every registered person may be assigned a goods
services tax
compliance and services tax compliance rating score by the Government based
rating. on his record of compliance with the provisions of this Act.

(2) The goods and services tax compliance rating score may
be determined on the basis of such parameters as may be
prescribed.

(3) The goods and services tax compliance rating score may
be updated at periodic intervals and intimated to the registered
person and also placed in the public domain in such manner as
may be prescribed.

Obligation to 150. (1) Any person, being—

furnish
information
return. (a) a taxable person; or

(b) a local authority or other public body or association; or

(c) any authority of the State Government responsible for

the collection of value added tax or sales tax or State excise duty
or an authority of the Central Government responsible for the
Central Act 43 of
collection of excise duty or customs duty; or
1961.

(d) an income tax authority appointed under the provisions

of the Income-tax Act, 1961;or

(e) a banking company within the meaning of clause (a) of Central Act 2 of
1934.
section 45A of the Reserve Bank of India Act, 1934; or

(f) a State Electricity Board or an electricity distribution or Central Act 36 of

transmission licensee under the Electricity Act, 2003, or any other 2003.
entity entrusted with such functions by the Central Government or
the State Government; or
Central Act 16 of
1908.
(g) the Registrar or Sub-Registrar appointed under section
6 of the Registration Act, 1908; or Central Act 18 of
2013.

(h) a Registrar within the meaning of the Companies Act,

2013; or

139
Central Act 59 of (i) the registering authority empowered to register motor
1988.
vehicles under the Motor Vehicles Act, 1988; or
Central Act 30 of
(j) the Collector referred to in clause (c) of section 3 of the
2013.
Right to Fair Compensation and Transparency in Land Acquisition,
Rehabilitation and Resettlement Act, 2013; or
Central Act 42 of (k) the recognized stock exchange referred to in clause (f)
1956.
of section 2 of the Securities Contracts (Regulation) Act, 1956; or
Central Act 22 of
1996. (l) a depository referred to in clause (e) of sub-section (1)
of section 2 of the Depositories Act, 1996; or
Central Act 2 of
1934. (m) an officer of the Reserve Bank of India as constituted
under section 3 of the Reserve Bank of India Act, 1934;or
Central Act 18 of
2013. (n) the Goods and Services Tax Network, a company
registered under the Companies Act, 2013;or

(o) a person to whom a Unique Identity Number has been

granted under sub-section (9) of section 25;or

(p) any other person as may be specified, on the

recommendations of the Council, by the Government,

who is responsible for maintaining record of registration or

statement of accounts or any periodic return or document
containing details of payment of tax and other details of transaction
of goods or services or both or transactions related to a bank
account or consumption of electricity or transaction of purchase,
sale or exchange of goods or property or right or interest in a
property under any law for the time being in force, shall furnish an
information return of the same in respect of such periods, within
such time, in such form and manner and to such authority or
agency as may be prescribed.
(2) Where the Commissioner, or an officer authorized by him
in this behalf, considers that the information furnished in the
information return is defective, he may intimate the defect to the
person who has furnished such information return and give him an
opportunity of rectifying the defect within a period of thirty days
from the date of such intimation or within such further period which,
on an application made in this behalf, the said authority may allow
and if the defect is not rectified within the said period of thirty
days or, the further period so allowed, then, notwithstanding
anything contained in any other provisions of this Act, such
information return shall be treated as not furnished and the
provisions of this Act shall apply.

(3) Where a person who is required to furnish information

return has not furnished the same within the time specified in sub-
section (1) or sub-section (2), the said authority may serve upon
him a notice requiring furnishing of such information return within a
period not exceeding ninety days from the date of service of the
notice and such person shall furnish the information return.

140
Power to collect 151. (1) The Commissioner may, if he considers that it is
statistics. necessary so to do, by notification, direct that statistics may be
collected relating to any matter dealt with by or in connection with
this Act.

(2) Upon such notification being issued, the Commissioner, or

any person authorized by him in this behalf, may call upon the
concerned persons to furnish such information or returns, in such
form and manner as may be prescribed, relating to any matter in
respect of which statistics is to be collected.

Bar on disclosure 152. (1) No information of any individual return or part thereof
of information. with respect to any matter given for the purposes of section 150 or
section 151 shall, without the previous consent in writing of the
concerned person or his authorized representative, be published in
such manner so as to enable such particulars to be identified as
referring to a particular person and no such information shall be
used for the purpose of any proceedings under this Act.

(2) Except for the purposes of prosecution under this Act or

any other Act for the time being in force, no person who is not
engaged in the collection of statistics under this Act or compilation
or computerization thereof for the purposes of this Act, shall be
permitted to see or have access to any information or any individual
return referred to in section 151.

(3) Nothing in this section shall apply to the publication of any

information relating to a class of taxable persons or class of
transactions, if in the opinion of the Commissioner, it is desirable in
the public interest to publish such information.

Taking assistance 153. Any officer not below the rank of Assistant Commissioner
from an expert.
may, having regard to the nature and complexity of the case and
the interest of revenue, take assistance of any expert at any stage
of scrutiny, inquiry, investigation or any other proceeding before
him.

Power to take 154. The Commissioner or an officer authorized by him may

samples.
take samples of goods from the possession of any taxable person,
where he considers it necessary, and provide a receipt for any
samples so taken.
Burden of Proof. 155. Where any person claims that he is eligible for input tax
credit under this Act, the burden of proving such claim shall lie on
such person.
Persons deemed 156. All persons discharging functions under this Act shall be Central Act 45 of
to be public 1860.
servants. deemed to be public servants within the meaning of section 21 of
the Indian Penal Code.

141
 157. (1) No suit, prosecution or other legal proceedings shall Protection of
lie against the President, State President, Members, officers or action taken
under this Act.
other employees of the Appellate Tribunal or any other person
authorized by the said Appellate Tribunal for anything which is in
good faith done or intended to be done under this Act or the
rules made thereunder.

(2) No suit, prosecution or other legal proceedings shall lie

against any officer appointed or authorized under this Act for
anything which is done or intended to be done in good faith under
this Act or the rules made thereunder.

158. (1) All particulars contained in any statement made, Disclosure of

return furnished or accounts or documents produced in accordance information by
a public
with this Act, or in any record of evidence given in the course of any servant.
proceedings under this Act (other than proceedings before a
criminal court), or in any record of any proceedings under this Act
shall, save as provided in sub-section (3), not be disclosed.

Central Act 1 of (2) Notwithstanding anything contained in the Indian Evidence

1872. Act, 1872, no court shall, save as otherwise provided in sub-section
(3), require any officer appointed or authorized under this Act to
produce before it or to give evidence before it in respect of
particulars referred to in sub-section(1).

(3) Nothing contained in this section shall apply to the

disclosure of,—

(a) any particulars in respect of any statement, return,

Central Act 45 of accounts, documents, evidence, affidavit or deposition, for the
1860.
purpose of any prosecution under the Indian Penal Code or the
Central Act 49 of Prevention of Corruption Act, 1988, or any other law for the time
1988.
being in force; or

(b) any particulars to the Central Government or the State

Government or to any person acting in the implementation of this
Act, for the purposes of carrying out the objects of this Act; or

(c) any particulars when such disclosure is occasioned by

the lawful exercise under this Act of any process for the service of
any notice or recovery of any demand; or

(d) any particulars to a civil court in any suit or

proceedings, to which the Government or any authority under this
Act is a party, which relates to any matter arising out of any
proceedings under this Act or under any other law for the time
being in force authorizing any such authority to exercise any
powers thereunder; or

(e) any particulars to any officer appointed for the

purpose of audit of tax receipts or refunds of the tax imposed by
this Act; or

142
 (f) any particulars where such particulars are relevant for
the purposes of any inquiry into the conduct of any officer appointed
or authorized under this Act, to any person or persons appointed as
an inquiry officer under any law for the time being in force; or

(g) any such particulars to an officer of the Central

Government or of any State Government, as may be necessary for
the purpose of enabling that Government to levy or realize any tax
or duty; or

(h) any particulars when such disclosure is occasioned by

the lawful exercise by a public servant or any other statutory
authority, of his or its powers under any law for the time being in
force; or
(i) any particulars relevant to any inquiry into a charge of
misconduct in connection with any proceedings under this Act
against a practicing advocate, a tax practitioner, a practicing cost
accountant, a practicing chartered accountant, a practicing
company secretary to the authority empowered to take disciplinary
action against the members practicing the profession of a legal
practitioner, a cost accountant, a chartered accountant or a
company secretary, as the case may be; or

(j) any particulars to any agency appointed for the

purposes of data entry on any automated system or for the purpose
of operating, upgrading or maintaining any automated system
where such agency is contractually bound not to use or disclose
such particulars except for the aforesaid purposes; or

(k) any such particulars to an officer of the Government

as may be necessary for the purposes of any other law for the time
being in force;
(l) Any information relating to any class of taxable
persons or class of transactions for publication, if, in the opinion of
the Commissioner, it is desirable in the public interest, to publish
such information.

Publication of 159. (1) If the Commissioner, or any other officer authorised by

information in
him in this behalf, is of the opinion that it is necessary or expedient
respect of
persons in in the public interest to publish the name of any person and any
certain cases. other particulars relating to any proceedings or prosecution under
this Act in respect of such person, it may cause to be published
such name and particulars in such manner as it thinks fit.

(2) No publication under this section shall be made in

relation to any penalty imposed under this Act until the time for
presenting an appeal to the Appellate Authority under section
107 has expired without an appeal having been presented or the
appeal, if presented, has been disposed of.
Explanation.— In the case of firm, company or other
association of persons, the names of the partners of the firm,
directors, managing agents, secretaries and treasurers or

143
managers of the company, or the members of the association,
as the case may be, may also be published if, in the opinion
of the Commissioner, or any other officer authorised by him in
this behalf, circumstances of the case justify it.

160. (1) No assessment, re-assessment, adjudication, review, Assessment

proceedings,
revision, appeal, rectification, notice, summons or other
etc. not to be
proceedings done, accepted, made, issued, initiated, or purported invalid on
to have been done, accepted, made, issued, initiated in pursuance certain
grounds.
of any of the provisions of this Act shall be invalid or deemed to
be invalid merely by reason of any mistake, defect or omission
therein, if such assessment, re-assessment, adjudication, review,
revision, appeal, rectification, notice, summons or other
proceedings are in substance and effect in conformity with or
according to the intents, purposes and requirements of this Act or
any existing law.

(2) The service of any notice, order or communication shall

not be called in question, if the notice, order or communication, as
the case may be, has already been acted upon by the person to
whom it is issued or where such service has not been called in
question at or in the earlier proceedings commenced, continued or
finalised pursuant to such notice, order or communication.

161. Without prejudice to the provisions of section 160, and Rectification of

errors apparent
notwithstanding anything contained in any other provisions of this
on the face of
Act, any authority, who has passed or issued any decision or order record.
or notice or certificate or any other document, may rectify any error
which is apparent on the face of record in such decision or order
or notice or certificate or any other document, either on its own
motion or where such error is brought to its notice by any officer
appointed under this Act or an officer appointed under the Central
Goods and Services Tax Act or by the affected person within a
period of three months from the date of issue of such decision or
order or notice or certificate or any other document, as the case
may be:

Provided that no such rectification shall be done after a period

of six months from the date of issue of such decision or order or
notice or certificate or any other document:

Provided further that the said period of six months shall not
apply in such cases where the rectification is purely in the nature of
correction of a clerical or arithmetical error, arising from any
accidental slip or omission:

Provided also that where such rectification adversely affects

any person, the principles of natural justice shall be followed by the
authority carrying out such rectification.

162. Save as provided in sections 117 and 118, no civil court Bar on jurisdiction
shall have jurisdiction to deal with or decide any question arising of civil courts.
from or relating to anything done or purported to be done under this
Act.

144
Levy of fee. 163. Wherever a copy of any order or document is to be
provided to any person on an application made by him for that
purpose, there shall be paid such fee as may be prescribed.

Power of 164. (1) The Government may, on the recommendations of the

Government to
make rules. Council, by notification, make rules for carrying out the provisions of
this Act.

(2) Without prejudice to the generality of the provisions of

sub- section (1), the Government may make rules for all or any of
the matters which by this Act are required to be, or may be,
prescribed or in respect of which provisions are to be or may be
made by rules.

(3) The power to make rules conferred by this section shall

include the power to give retrospective effect to the rules or any of
them from a date not earlier than the date on which the provisions
of this Act come into force.

(4) Any rules made under sub-section (1) or sub-section (2)

may provide that a contravention thereof shall be liable to a penalty
not exceeding ten thousand rupees.

Power to make 165. The Government may, by notification, make regulations

Rules.
consistent with this Act and the rules made thereunder to carry out
the provisions of this Act.

Laying of rules, 166. Every rule made by the Government, every regulation
regulations and
notifications. made by the Government and every notification issued by the
Government under this Act, shall be laid, as soon as may be after it
is made or issued, before the State Legislature, while it is in
session, for a total period of thirty days which may be comprised in
one session or in two or more successive sessions, and if,
before the expiry of the session immediately following the session
or the successive sessions aforesaid, the State Legislature agrees
in making any modification in the rule or regulation or in the
notification, as the case may be, or the State Legislature agrees
that the rule or regulation or the notification should not be made,
the rule or regulation or notification, as the case may be, shall
thereafter have effect only in such modified form or be of no effect,
as the case may be; so, however, that any such modification or
annulment shall be without prejudice to the validity of anything
previously done under that rule or regulation or notification, as the
case may be.

Delegation of 167. The Commissioner may, by notification, direct that

powers.
subject to such conditions, if any, as may be specified in the
notification, any power exercisable by any authority or officer under
this Act may be exercisable also by another authority or officer as
may be specified in such notification.

145
 168. The Commissioner may, if he considers it necessary or Power to issue
instructions or
expedient so to do for the purpose of uniformity in the directions.
implementation of this Act, issue such orders, instructions or
directions to the State tax officers as it may deem fit, and thereupon
all such officers and all other persons employed in the
implementation of this Act shall observe and follow such orders,
instructions or directions.

1 1
[168-A. (1) Notwithstanding anything contained in this Act, the [Power of
Insertion of new
section 168-A. Government to
Government may, on the recommendations of the Council, by extend time limit
notification, extend the time limit specified in, or prescribed or in special
circumstances]
notified under, this Act in respect of actions which cannot be
completed or complied with due to force majeure.

(2) The power to issue notification under sub-section (1) shall

include the power to give retrospective effect to such notification
from a date not earlier than the date of commencement of this Act.

Explanation.- For the purposes of this section, the

expression ―force majeure‖ means a case of war, epidemic, flood,
drought, fire, cyclone, earthquake or any other calamity caused by
nature or otherwise affecting the implementation of any of the
provisions of this Act.]‖

169. (1) Any decision, order, summons, notice or other Service of notice
in certain
communication under this Act or the rules made thereunder shall circumstances.
be served by any one of the following methods, namely

(a) by giving or tendering it directly or by a messenger

including a courier to the addressee or the taxable person or to his
manager or authorised representative or an advocate or a tax
practitioner holding authority to appear in the proceedings on
behalf of the taxable person or to a person regularly employed by
him in connection with the business, or to any adult member
of family residing with the taxable person; or

(b) by registered post or speed post or courier with

acknowledgement due, to the person for whom it is intended or his
authorised representative, if any, at his last known place of
business or residence; or

(c) by sending a communication to his e-mail address

provided at the time of registration or as amended from time to
time; or

(d) by making it available on the common portal; or

(e) by publication in a newspaper circulating in the locality

in which the taxable person or the person to whom it is issued is
last known to have resided, carried on business or personally
worked for gain; or
---------------------------------------------------------------------------------------
1
Inserted vide Tamil Nadu Act 29 of 2020 dated 19.10.2020 w.e.f 31.03.2020

146
 (f) if none of the modes aforesaid is practicable, by affixing it in
some conspicuous place at his last known place of business or
residence and if such mode is not practicable for any reason,
then by affixing a copy thereof on the notice board of the office
of the concerned officer or authority who or which passed such
decision or order or issued such summons or notice.
(2) Every decision, order, summons, notice or any
communication shall be deemed to have been served on the date
on which it is tendered or published or a copy thereof is affixed in
the manner provided in sub-section (1).
(3) When such decision, order, summons, notice or any
communication is sent by registered post or speed post, it shall be
deemed to have been received by the addressee at the expiry of
the period normally taken by such post in transit unless the contrary
is proved.

Rounding off of 170. The amount of tax, interest, penalty, fine or any other sum
tax, etc. payable, and the amount of refund or any other sum due, under the
provisions of this Act shall be rounded off to the nearest rupee and,
for this purpose, where such amount contains a part of a rupee
consisting of paisa, then, if such part is fifty paisa or more, it shall
be increased to one rupee and if such part is less than fifty
paisa it shall be ignored.

Anti-profiteering 171. (1) Any reduction in rate of tax on any supply of goods or
Measure. services or the benefit of input tax credit shall be passed on to the
recipient by way of commensurate reduction in prices.
(2) The Central Government may, on recommendations of the
Council, by notification, constitute an Authority, or empower an
existing Authority constituted under any law for the time being in
force, to examine whether input tax credits availed by any
registered person or the reduction in the tax rate have actually
resulted in a commensurate reduction in the price of the goods or
services or both supplied by him.
(3) The Authority referred to in sub-section (2) shall exercise
such powers and discharge such functions as may be prescribed.
1
[(4) Where the authority referred to in sub-section (2), after
holding examination as required under the said sub-section comes
to the conclusion that any registered person has profiteered under
sub-section (1), such person shall be liable to pay penalty
equivalent to ten per cent of the amount so profiteered:
Provided that no penalty shall be leviable if the profiteered
amount is deposited within thirty days of the date of passing of the
order by the authority.
Explanation.— For the purposes of this section, the
expression ―profiteered‖ shall mean the amount determined on
account of not passing the benefit of reduction in rate of tax on
supply of goods or services or both or the benefit of input tax credit
to the recipient by way of commensurate reduction in the price of
the goods or services or both.‖.]
-------------------------------------------------------------------------------------
1
Added by TN Act 10 of 2020 dt.15.02.2020, w.e.f 01.01.2020

147
 172. (1) If any difficulty arises in giving effect to any provisions Removal of
of this Act, the Government may, on the recommendations of the difficulties.
Council, by a general or a special order published in the Official
Gazette, make such provisions not in consistent with the provisions
of this Act or the rules or regulations made thereunder, as may be
necessary or expedient for the purpose of removing the said
difficulty:

Provided that no such order shall be made after the expiry of

1
a period of [five years] from the date of commencement of this Act.

(2) Every order made under this section shall be laid, as soon
as may be, after it is made, before the State Legislature

173. Save as otherwise provided in this Act, on and from the Amendment of
date of commencement of this Act,— certain Acts

Tamil Nadu Act IV (i) in the Chennai City Municipal Corporation Act,1919,—
of 1919
(a) in section 98, clause (f) shall be omitted;
(b) sections 129 and 129-A shall be omitted;
(c) in section 129-B,—
(1) in sub-section (1), the expression ―after the levy
of the tax under section 129-A has been
determined upon by the council‖ shall be
omitted;
(2) in sub-section(2),—
(A) in clause (i), the expression ―or‖ at the
end shall be omitted;
(B) clause (ii) shall be omitted;
(d) in sections 129-D and 129-E, the expression
―section 129-A or‖ shall be omitted;
(e) sections 129-F and 326-CC shall be omitted;
(f) in Schedule VII, the entries relating to section 129
shall be omitted;
Tamil Nadu Act V (ii) in the Tamil Nadu District Municipalities Act,1920,—
of 1920.
(a) in section 78, clause (dd) shall be omitted;
(b) section 107-A shall be omitted;
(c) in section107-B,—
(1) in sub-section (1), the expression ―after the levy
of the tax under section 107-A has been
determined upon in the municipal council,‖
shall be omitted;
(2) in sub-section (2), clause (ii) shall be omitted;
(d) in sections 107-D and 107-E, the expression
―section 107-A or‖ shall be omitted;
(e) sections 107-F and 285-CC shall be omitted;
-------------------------------------------------------------------------------------
1
Substituted for ―three years‖., by TN Act 29 of 2020 dated 19.10.2020 w.e.f
30.06.2020

148
 (iii) in the Madurai City Municipal Corporation Act,1971,— Tamil Nadu Act 15
of 1971.
(a) in section 115, clause (e) shall be omitted;
(b) section 157 shall be omitted;
(c) in section158,—
(1) in sub-section (1), the expression ―after the levy
of the tax under section 157 has been
determined upon by the council‖ shall be
omitted;
(2) in sub-section (2), clause (ii) shall be omitted;

(d) in sections 160 and 161, the expression ―section 157

or‖ shall be omitted;

(e) sections 162 and 410-CC shall be omitted;

(iv) in the Coimbatore City Municipal Corporation
Act,1981,— Tamil Nadu Act 25
of 1981
(a) in section 117, clause (e) shall be omitted;
(b) section 158 shall be omitted;
(c) in section 159, —
(1) in sub-section (1), the expression ―after the
levy of the tax under section 158 has been
determined upon in the council,‖ shall be
omitted;

(2) in sub-section (2), clause (ii) shall be omitted;

(d) in sections 161 and 162, the expression ―section 158
or‖ shall be omitted;

(e) sections 163 and 410-CC shall be omitted;

(v) in the Tamil Nadu Panchayats Act,1994,— Tamil Nadu Act 21
of 1994
(a) section 172-A shall be omitted;

(b) in section 172-B, the expression ―after the levy of

the tax under section 172-A as determined by the
collector‖ shall be omitted;

(c) in section 174, for the expression ―sections 171,

172 and 172-A‖, the expression ―sections 171 and
172‖ shall be substituted;

(d) Section 175-A shall be omitted.

Repeal and 174. (1) Save as otherwise provided in this Act, on and
saving. from the date of commencement of this Act,—

(i) the Tamil Nadu Value Added Tax Act, 2006 except in Tamil Nadu Act 32
respect of goods included in Entry 54 of the State List of 2006
of the Seventh Schedule to the Constitution;

149
Tamil Nadu Act XX (ii) The Tamil Nadu Betting Tax Act,1935;
of 1935

Tamil Nadu Act X (iii) The Tamil Nadu Entertainments Tax Act,1939;
of 1939.

Tamil Nadu Act 6 (iv) The Tamil Nadu Tax on Luxuries Act,1981;
of 1981.

Tamil Nadu Act 22 (v) The Tamil Nadu Advertisement Tax Act,1983;
of 1983.

Tamil Nadu Act 13 (vi) The Tamil Nadu Tax on Entry of Motor Vehicles into
of 1990. Local Areas Act,1990;

Tamil Nadu Act 20 (vii) The Tamil Nadu Tax on Entry of Goods into Local
of 2001. Areas Act, 2001; (hereafter referred to as the
repealed Acts) are hereby repealed.

(2) The repeal of the said Acts and the amendment of the
Acts specified in section 173 (hereafter referred to as ―such
amendment‖ or ―amended Act‖, as the case may be) to the extent
mentioned in sub-section(1) or section173 shall not—
(a) revive anything not in force or existing at the time of
such amendment or repeal; or

(b) affect the previous operation of the amended Acts or

repealed Acts and orders or anything duly done or suffered
thereunder; or
(c) affect any right, privilege, obligation, or liability
acquired, accrued or incurred under the amended Acts or repealed
Acts or orders under such repealed or amended Acts:
Provided that any tax exemption granted as an incentive
against investment through a notification shall not continue as
privilege if the said notification is rescinded on or after the
appointed day; or
(d) affect any tax, surcharge, penalty, fine, interest as are
due or may become due or any forfeiture or punishment incurred or
inflicted in respect of any offence or violation committed against the
provisions of the amended Acts or repealed Acts; or

(e) affect any investigation, inquiry, verification (including

scrutiny and audit), assessment proceedings, adjudication and any
other legal proceedings or recovery of arrears or remedy in respect
of any such tax, surcharge, penalty, fine, interest, right, privilege,
obligation, liability, forfeiture or punishment, as aforesaid, and any
such investigation, inquiry, verification (including scrutiny and
audit), assessment proceedings, adjudication and other legal
proceedings or recovery of arrears or remedy may be instituted,
continued or enforced, and any such tax, surcharge, penalty, fine,
interest, forfeiture or punishment may be levied or imposed as if
these Acts had not been so amended or repealed; or

150
 (f) affect any proceedings including that relating to an appeal,
revision, review or reference, instituted before, on or after the
appointed day under the said amended Acts or repealed Acts and
such proceedings shall be continued under the said amended Acts
or repealed Acts as if this Act had not come into force and the said
Acts had not been amended or repealed.

(3) The mention of the particular matters referred to in section Tamil Nadu Act 1
of 1891
173 and sub-section (1) shall not be held to prejudice or affect the
general application of section 8 of the Tamil Nadu General Clauses
Act, 1891 with regard to the effect of repeal.

151
 SCHEDULE I.
[See Section 7]

ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE

WITHOUT CONSIDERATION

1. Permanent transfer or disposal of business assets where

input tax credit has been availed on such assets.

2. Supply of goods or services or both between related

persons or between distinct persons as specified in section 25,
when made in the course or furtherance of business:

Provided that gifts not exceeding fifty thousand rupees in

value in a financial year by an employer to an employee shall not
be treated as supply of goods or services or both.

3. Supply of goods—

(a) by a principal to his agent where the agent undertakes

to supply such goods on behalf of the principal; or

(b) by an agent to his principal where the agent undertakes

to receive such goods on behalf of the principal.
1
4. Import of services by a [person] from a related person or
from any of his other establishments outside India, in the course or
furtherance of business.

SCHEDULE II.
[See Section 7]
2
ACTIVITIES [OR TRANSACTIONS] TO BE TREATED AS
SUPPLY OF GOODS OR SUPPLY OF SERVICES

1. Transfer

(a) any transfer of the title in goods is a supply of goods;

(b) any transfer of right in goods or of undivided share in

goods without the transfer of title thereof, is a supply of services;

(c) any transfer of title in goods under an agreement which

stipulates that property in goods shall pass at a future date upon
payment of full consideration as agreed, is a supply of goods.
2. Land and Building
(a) any lease, tenancy, easement, license to occupy land
is a supply of services;
(b) any lease or letting out of the building including a
commercial, industrial or residential complex for business or
commerce, either wholly or partly, is a supply of services.
----------------------------------------------------------------------------------------
1
Substituted for ―taxable person‖., by TN Act 3 of 2019 dated 14.01.2019 w.e.f
01.02.2019
2
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.07.2017

152
 3. Treatment or process
Any treatment or process which is applied to another
person‘s goods is a supply of services.

4. Transfer of business assets

(a) where goods forming part of the assets of a business
are transferred or disposed of by or under the directions of the
person carrying on the business so as no longer to form part of
1
those assets, [*****] such transfer or disposal is a supply of
goods by the person;
(b) where, by or under the direction of a person carrying on
a business, goods held or used for the purposes of the business
are put to any private use or are used, or made available to any
person for use, for any purpose other than a purpose of the
1
business, [*****], the usage or making available of such goods is a
supply of services;
(c) where any person ceases to be a taxable person, any
goods forming part of the assets of any business carried on by him
shall be deemed to be supplied by him in the course or
furtherance of his business immediately before he ceases to be a
taxable person, unless—
(i) the business is transferred as a going concern to
another person; or
(ii) the business is carried on by a personal
representative who is deemed to be a taxable person.

5. Supply of services
The following shall be treated as supply of services,
namely:—
(a) renting of immovable property;
(b) construction of a complex, building, civil structure or a
part thereof, including a complex or building intended for sale to a
buyer, wholly or partly, except where the entire consideration has
been received after issuance of completion certificate, where
required, by the competent authority or after its first occupation,
whichever is earlier.
-------------------------------------------------------------------------------------
1
Omitted the expression ―‖whether or not for a consideration‖ in two places where
it occurs by TN Act 29 of 2020 dated 19.10.2020‖ w.e.f 01.07.2017
Vide Tamil Nadu Goods and Services Tax (Fourth Removal of Difficulties)
Order 2019 - G.O.Ms.No.49 Commercial Taxes and Registration dated 29.03.2019,
published as Commercial Taxes and Registration Department Notification No.
II(2)/CTR/269(c-8)/2019 at page 25 in Part II-Section 2 of the Tamil Nadu
Government Gazette Extraordinary No.156, dated 29th March, 2019.
For the removal of difficulties, it is hereby clarified that in case of supply of
services covered by clause (b) of paragraph 5 of Schedule II of the TNGST Act,
the amount of credit attributable to the taxable supplies including zero rated supplies
and exempt supplies shall be determined on the basis of the area of the construction
of the complex, building, civil structure or a part thereof, which is taxable and the
area which is exempt. This Order shall come into force with effect from the 1st day
of April 2019.

153
 Explanation.—For the purposes of this clause—

(1) the expression ―competent authority‖ means the

Government or any authority authorized to issue completion
certificate under any law for the time being in force and in case of
non-requirement of such certificate from such authority, from any of
the following, namely:–

Central Act 20 of (i) an architect registered with the Council of

1972.
Architecture constituted under the Architects Act,
1972;or
(ii) a chartered engineer registered with the Institution
of Engineers (India);or
(iii) a licensed surveyor of the respective local body of
the city or town or village or development or
planning authority;

(2) the expression ―construction‖ includes additions,

alterations, replacements or remodeling of any existing civil
structure;
(c) temporary transfer or permitting the use or enjoyment
of any intellectual property right;

(d) development, design, programming, customization,

adaptation, up gradation, enhancement, implementation of
information technology software;

(e) agreeing to the obligation to refrain from an act, or to

tolerate an act or a situation, or to do an act; and

(f) Transfer of the right to use any goods for any purpose
(whether or not for a specified period) for cash, deferred payment or
other valuable consideration.

6. Composite supply
The following composite supplies shall be treated as a supply
of services, namely:—
(a) works contract as defined in clause (119) of section 2;
and
(b) supply, by way of or as part of any service or in any
other manner whatsoever, of goods, being food or any other article
for human consumption or any drink (other than alcoholic liquor for
human consumption), where such supply or service is for cash,
deferred payment or other valuable consideration
7. Supply of Goods
The following shall be treated as supply of goods, namely:—
Supply of goods by any unincorporated association or body of
persons to a member thereof for cash, deferred payment or other
valuable consideration.

154
 SCHEDULE III.
[See Section 7]

ACTIVITIES OR TRANSACTIONS WHICH SHALL BE TREATED

NEITHER AS A SUPPLY OF GOODS NOR A SUPPLY OF
SERVICES

1. Services by an employee to the employer in the course of

or in relation to his employment.

2. Services by any court or Tribunal established under any law

for the time being in force.

3. (a) the functions performed by the Members of Parliament,

Members of State Legislature, Members of Panchayats, Members
of Municipalities and Members of other local authorities;

(b) the duties performed by any person who holds any post
in pursuance of the provisions of the Constitution in that capacity; or

(c) the duties performed by any person as a Chairperson

or a Member or a Director in a body established by the Central
Government or a State Government or local authority and who is
not deemed as an employee before the commencement of this
clause.

4. Services of funeral, burial, crematorium or mortuary

including transportation of the deceased.

5. Sale of land and, subject to clause (b) of paragraph 5 of

Schedule II, sale of building.

6. Actionable claims, other than lottery, betting and gambling.

1
[7. Supply of goods from a place outside India to another
place outside India without such goods entering into India.

8. (a) Supply of warehoused goods to any person before

clearance for home consumption;

(b) Supply of goods by the consignee to any other person,

by endorsement of documents of title to the goods, after the goods
have been dispatched from the port of origin located outside India
but before clearance for home consumption.‖;]
2
[Explanation 1]— For the purposes of paragraph 2, the term
―court‖ includes District Court, High Court and Supreme Court.
3
[―Explanation 2— For the purposes of paragraph 8, the
expression ―warehoused goods‖ shall have the same meaning as
assigned to it in the Customs Act, 1962 (Central Act 52 of 1962)].‖
----------------------------------------------------------------------------------------
1
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.
2
Explanation Numbered as Explanation 1, by TN Act 3 of 2019 dated 14.01.2019
w.e.f 01.02.2019
3
Inserted by TN Act 3 of 2019 dated 14.01.2019 w.e.f 01.02.2019.

155
 The following removal of difficulties orders have been issued:-

ROD 1 / 2017 For the removal of difficulties,- Section 10

G.O. Ms No 137,
(i) it is hereby clarified that if a person supplies goods and/or
CT & R (B1),
Dt 13.10.2017 services referred to in clause (b) of paragraph 6 of Schedule II of
the TNGST Act and also supplies any exempt services including
services by way of extending deposits, loans or advances in so far
as the consideration is represented by way of interest or discount,
the said person shall not be ineligible for the composition scheme
under section 10 subject to the fulfilment of all other conditions
specified therein.

(ii) it is further clarified that in computing his aggregate turnover in

order to determine his eligibility for composition scheme, value of
supply of any exempt services including services by way of
extending deposits, loans or advances in so far as the
consideration is represented by way of interest or discount, shall
not be taken into account.

ROD 1/2018 In Section 44 of the Tamil Nadu Goods and Services Tax Act, Section 44

G.O. Ms No 156, 2017, after sub-section (2), the following Explanation shall be
CT & R (B1), inserted, namely:––
Dt 12.12.2018
Explanation.- For the purposes of this Section, it is hereby
declared that the annual return for the period from the 1st July,
2017 to the 31st March, 2018 shall be furnished on or before the
31st March, 2019.

ROD 2/2018 In sub-section (4) of Section 16 of the TNGST Act, the following Section 16 (4)
Section 37(3)
G.O. Ms No 157, proviso shall be inserted, namely: -
CT & R (B1),
Dt 31.12.2018 Provided that the registered person shall be entitled to take input
tax credit after the due date of furnishing of the return under
Section 39 for the month of September, 2018 till the due date of
furnishing of the return under the said Section for the month of
March, 2019 in respect of any invoice or invoice relating to such
debit note for supply of goods or services or both made during the
financial year 2017-18, the details of which have been uploaded by
the supplier under sub-section (1) of Section 37 till the due date for
furnishing the details under sub-section (1) of said Section for the
month of March, 2019.
In sub-section (3) of Section 37 of the TNGST Act, after the existing
proviso, the following proviso shall be inserted, namely:––
―Provided further that the rectification of error or omission in respect
of the details furnished under sub-section (1) shall be allowed after
furnishing of the return under Section 39 for the month of
September, 2018 till the due date for furnishing the details under
sub-section (1) for the month of March, 2019 or for the quarter
January, 2019 to March, 2019.‖.

156
ROD 3/2018 Section 44
In Section 44 of the Tamil Nadu Goods and Services Tax Act,
G.O. Ms No 158, 2017, in the Explanation, for the figures, letters and word ―31st
CT & R (B1),
March, 2019‖, the figures, letters and word ―30th June, 2019‖ shall
Dt 31.12.2018
be substituted.

ROD 4/2018 In Section 52 of the Tamil Nadu Goods and Services Tax Act, Section 52 (4)

G.O. Ms No 159, 2017, in sub-section (4), the following Explanation shall be inserted,
CT & R (B1), namely: ––
Dt 31.12.2018
Explanation: - For the purposes of this sub-section, it is hereby
declared that the due date for furnishing the said statement for the
months of October, November and December, 2018 shall be the
31st January, 2019.

ROD 1/2019 For the removal of difficulties, it is hereby clarified that the value of Section 10 (1)

G.O. Ms No 20, supply of exempt services by way of extending deposits, loans or

CT & R (B1), advances in so far as the consideration is represented by way of
Dt 01.02.2019
interest or discount, shall not be taken into account -
(i) for determining the eligibility for composition scheme under
second proviso to sub-section (1) of Section 10;
(ii) in computing aggregate turnover in order to determine eligibility
for composition scheme.

ROD 2/2019 In section 52 of the Tamil Nadu Goods and Services Tax Act, 2017, Section 52 (4)

G.O. Ms No 22, in sub-section (4), in the Explanation, for the figures, letters and
CT & R (B1), word ―31st January, 2019‖, the figures, letters and word ―07th
Dt 01.02.2019
February, 2019‖ shall be substituted.

ROD 3/2019 For the removal of difficulties, it is hereby clarified that provisions of Section 31 (3)(c)

G.O. Ms No 36, clause (c) of sub-section (3) of Section 31 of the TNGST Act shall
CT & R (B1), apply to a person paying tax under the Commercial Taxes and
Dt 08.03.2019
Registration Department Notification No. II(2)/CTR/212(g-1)/2019,
published at pages 1-3 in Part II-Section 2 of the Tamil Nadu
Government Gazette Extraordinary, dated the 7th March, 2019.

ROD 4/2019 For the removal of difficulties, it is hereby clarified that in case of Schedule II 5(b)

G.O. Ms No 49, supply of services covered by clause (b) of paragraph 5 of

CT & R (B1), Schedule II of the TNGST Act, the amount of credit attributable to
Dt 29.03.2019
the taxable supplies including zero rated supplies and exempt
supplies shall be determined on the basis of the area of the
construction of the complex, building, civil structure or a part
thereof, which is taxable and the area which is exempt.
3. This Order shall come into force with effect from the 1st day of
April 2019.

157
ROD 5/2019 In sub-section (1) of section 30 of the TNGST Act, the following Section 30(1)

G.O. Ms No 51, proviso shall be inserted, namely:-―Provided that the registered

CT & R (B1), person who was served notice under sub-section (2) of section 29
Dt 23.04.2019
in the manner as provided in clause (c) or clause (d) of sub-section
(1) of section 169 and who could not reply to the said notice,
thereby resulting in cancellation of his registration certificate and is
hence unable to file application for revocation of cancellation of
registration under sub-section (1) of section 30 of the Act, against
such order passed up to 31-03-2019, shall be allowed to file
application for revocation of cancellation of the registration not later
than 22-07-2019.‖.

ROD 6/2019 In section 44 of the Tamil Nadu Goods and Services Tax Act, 2017, Section 44

G.O. Ms No 97, in the Explanation, for the figures, letters and word ―30th June,
CT & R (B1), 2019‖, the figures, letters and word ―31st August, 2019‖ shall be
Dt 28.06.2019
substituted.

ROD 7/2019 In section 44 of the Tamil Nadu Goods and Services Tax Act, 2017, Section 44

G.O. Ms No 121, in the Explanation, for the figures, letters and word ―31st August,
CT & R (B1), 2019‖, the figures, letters and word ―30th November, 2019‖ shall be
Dt 27.08.2019
substituted.

ROD 8/2019 For the Explanation in section 44 of the Tamil Nadu Goods and Section 44

G.O. Ms No 182, Services Tax Act, 2017, the following Explanation shall be
CT & R (B1), substituted, with effect from the 14th November, 2019, namely:–
Dt 18.11.2019
―Explanation.-For the purposes of this section, it is hereby declared
that the annual return for the period from the 1st July, 2017 to the
31st March, 2018 shall be furnished on or before the 31st
December, 2019 and the annual return for the period from the 1st
April, 2018 to the 31st March, 2019 shall be furnished on or before
the 31st March, 2020.‖.

ROD 9/2019 For the removal of difficulties, it is hereby clarified that for the Section 112(1)

G.O. Ms No 185, purpose of calculating,-

CT & R (B1),
Dt 04.12.2019
(a) the ―three months from the date on which the order sought to be
appealed against is communicated to the person preferring the
appeal‖ in sub-section (1) of section 112, the start of the three
months period shall be considered to be the later of the following
dates:-
(i) date of communication of order; or
(ii) the date on which the President or the State President, as the
case may be, of the Appellate Tribunal after its constitution under
Section 109, enters office;

(b) the ―six months from the date on which the said order has been
passed‖ in sub-section (3) of Section 112, the start of the six
months period shall be considered to be the later of the following
dates:-

158
 (i) date of communication of order; or
(ii) the date on which the President or the State President, as the
case may be, of the Appellate Tribunal after its constitution under
section 109, enters office.

ROD 10/2019 In section 44 of the Tamil Nadu Goods and Services Tax Act, 2017, Section 44

G.O. Ms No 200, in the Explanation, for the figures, letters and word ―31st December,
CT & R (B1), 2019‖, the figures, letters and word ―31st January, 2020‖ shall be
Dt 30.12.2019
substituted.

ROD 1/2020 For the removal of difficulties, it is hereby clarified that for the Section 30 (1)
G.O. Ms No 102, purpose of calculating the period of thirty days for filing application
CT & R (B1), for revocation of cancellation of registration under sub-section (1) of
Dt 26.06.2020
Section 30 of the Act for those registered persons who were served
notice under clause (b) or clause (c) of sub-section (2) of Section
29 in the manner as provided in clause (c) or clause (d) of sub-
section (1) of Section 169 and where cancellation order was
passed up to 12th June, 2020, the later of the following dates shall
be considered:-
(a) Date of service of the said cancellation order; or
(b) 31st day of August, 2020.

159