The government has recently implemented a track and trace system with the aim to stop evasion of GST, more specifically in the tobacco-related sector. Tobacco-related products account for approximately 5% of the total Goods and Services Tax (GST) revenue. Products related to tobacco now account for the fifth-largest share of India's GST revenue. Under the Track and Trace system, a unique identification marking will be applied to tobacco-related products, which will enable the government to trace the goods from the factory to the retail shop.

At Shine Legal India, we assist businesses with GST registration to ensure compliance with new rules like the Track and Trace system.

The ‘Track and Trace’ system applies to manufacturers of various tobacco-related products such as:

• -> Pan masala
• -> Jarda-scented tobacco
• -> Unmanufactured tobacco (without lime tube)
• -> Pipe tobacco and cigarette tobacco
• -> Chewing tobacco (without lime tube)
• -> Hookah or gudaku tobacco
• -> Filter khaini
• -> Snuff
• -> Branded or unbranded gutkha

Introduction of GST SRM-I and GST SRM-II forms for manufacturers of pan masala and tobacco products

•  Form GST SRM-I is used for registering and disposing of manufacturing machines.
•  Form GST SRM-II is used for reporting the monthly inputs of materials used and outputs of how many products are made.

Businesses engaged in this sector should ensure proper GST registration to avoid legal issues. Shine Legal India offers expert services .

Uses of GST SRM-I and GST SRM-II forms for manufacturers of pan masala and tobacco products
The GST department has introduced the above-mentioned two forms specially for manufacturers of pan masala and tobacco-related products to register their machines. Additionally, these forms will be used to notify the authorities whenever these machines are disposed of, which will give the government the assurance that the disposal is officially recorded and tracked.

We recommend early GST registration through Shine Legal India to ensure alignment with evolving GST norms and documentation practices.

The GST department will provide unique codes and tools under the Track and Trace system.
The Track and Trace system will include ways to attach unique identification marks to goods. It will also help in finding the information about the storage of the products digitally. It will also make information easier to access. With the help of this new system, specific goods will be better tracked and monitored for improved transparency and regulation.

Proper GST registration is now more critical than ever. Shine Legal India helps clients prepare for and adapt to government technological advances like these.

Implementation of Track and Trace system

To implement the Track and Trace system, a new section 148A has been added to the Central Goods and Services Tax Act 2017. Section 148A empowers the government to decide which goods are involved in the transaction and who is required to use a Track & Trace system. This new mechanism is based on the guidelines set by the World Health Organisation (WHO) to fight the illegal trade of tobacco products.