The Government of India has promulgated the Manipur Goods and Services Tax (Amendment) Ordinance, 2025 to bring the state’s GST framework in line with the recent amendments made to the Central Goods and Services Tax Act, 2017 through the Finance (No.2) Act, 2024.
This move comes after the Manipur Legislative Assembly was prorogued and Parliament was not in session, necessitating urgent action by the President under Article 123 of the Constitution.
Key Legislative Background
The Ordinance was issued in light of the GST Council’s 54th meeting decision to implement necessary changes from November 1, 2024. Earlier efforts through the Manipur GST (Eighth Amendment) Ordinance, 2024 had lapsed in April 2025. With Article 356 invoked in the state, legislative powers now vest in the Parliament under the President’s authority.
Notable Amendments Introduced
Tax on Extra Neutral Alcohol:
Section 9 of the Manipur GST Act has been amended to include un-denatured extra neutral alcohol or rectified spirit used for manufacturing alcoholic liquor, making it taxable under state GST.
New Section on General Practice Exemption:
A new Section 11A has been inserted to provide immunity from GST recovery where a generally prevalent practice existed regarding non-levy or partial levy of tax. The government may issue notifications to exempt such supplies from retrospective tax liability.
Changes in Input Tax Credit (ITC):
Significant relief has been granted through amendments to Section 16, allowing ITC claims for invoices from FY 2017-18 to 2020-21 until November 30, 2021. Taxpayers whose registrations were revoked and later reinstated can also reclaim eligible ITC for the relevant period.
Introduction of Section 74A for New Tax Periods:
Section 74A introduces a new framework for determining tax liabilities, erroneous refunds, or wrongly claimed ITC for periods starting FY 2024-25 onwards. It lays down a structured approach for issuing show cause notices, determining penalties (ranging from 10% to 100% of tax due), and resolving cases without litigation if payments are made promptly.
Limitations on Refunds:
Section 54 now bars refunds of unutilised ITC or IGST on zero-rated exports of goods if those goods are subject to export duty.
Amendments in Appeals and Penalties:
Appeal-related provisions under Sections 107 and 112 have been revised to lower the pre-deposit requirement from 20% to 10% and reduce the monetary ceiling from ₹50 crore to ₹20 crore. Also, new timelines have been provided for filing appeals based on government notifications.
New Waiver Provision Under Section 128A:
A new section allows waiver of interest and penalty on tax demands raised under Section 73 for the period July 1, 2017 to March 31, 2020, if the taxpayer clears the full tax liability by a government-notified date. However, this benefit will not apply to cases involving erroneous refunds or where appeals remain pending and unwithdrawn.
Clarifications on Co-insurance and Reinsurance:
Schedule III now includes activities related to co-insurance and reinsurance to clarify GST obligations. Lead insurers will be responsible for GST on total premium, and reinsurers must pay GST on the gross premium, including ceding commissions.
Anti-Profiteering Sunset Clause Introduced:
Section 171 has been amended to allow the government to notify a cutoff date beyond which anti-profiteering complaints will no longer be accepted. This brings regulatory closure to ongoing disputes around passing on tax benefits to consumers.
Validation of Earlier Actions:
The Ordinance validates all actions taken under the lapsed 2024 Ordinance, treating them as if taken under this new law.
Notification Details
Ordinance No. NO. 1 OF 2025
Date: 9th June, 2025
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