Consent Letter For GST Registration: Format, Rules & Sample

A Consent Letter for GST Registration is a “No Objection Certificate” (NOC) required when a business operates from a premise owned by a relative (like parents or spouse) without paying rent. It certifies that the property owner permits the business to use the address as the “Principal Place of Business” for GST registration purposes. It must be uploaded along with the owner’s proof of ownership (Electricity Bill/Property Tax Receipt) on the GST Portal.

1. Meaning & Definition: What is a GST Consent Letter?

The Consent Letter is effectively a permission slip. Under the CGST Act, 2017, every registered taxpayer must provide proof of their “Principal Place of Business.”

When a business owner owns the office, they submit the property deed. When they rent it, they submit the Rent Agreement. However, a gap exists for small businesses and freelancers who operate from a space owned by a relative (e.g., a son running a consultancy from his father’s house). Since no rent is paid, no Rent Agreement exists. In this scenario, the Consent Letter acts as the valid legal proof of address.

It serves two purposes:

1. Authorization: It proves the owner knows and agrees to the business activity.

2. Verification: It links the applicant to a verifiable address (via the attached Utility Bill).

2. Why it Matters: The Legal Importance

Compliance & Rejection Prevention

Failing to provide a proper Consent Letter is one of the top reasons for the rejection of new GST registration applications in Bihar.

Why is the Department Strict? The GST Department wants to prevent “shell companies” or “fake invoicing” firms that register using random addresses. The Consent Letter, backed by the owner’s signature and ID, creates a trail of accountability.

3. How it Works: The Process

Step-by-Step Guide to Filing

To successfully use a consent letter for your GST registration, follow this workflow:

1. Verify Ownership: Ensure the electricity bill is in the name of the person signing the consent letter. If the meter is in a grandfather’s name who is deceased, you cannot use a simple consent letter; you need a legal heir certificate or name change first.

2. Draft the Letter: Use the format provided in the next section.

3. Signatures: The owner (Consenter) must sign it in blue ink.

4. Notarization (Optional but Recommended): While not strictly mandated by the central act for all cases, having the letter notarized by a Public Notary adds a layer of authenticity that prevents queries from the proper officer.

5. Scan & Combine: Scan the signed letter + the Electricity Bill into a single PDF (Max file size 1 MB).

6. Upload: On the GST Portal (reg.gst.gov.in), under the “Principal Place of Business” tab, select “Consent” from the dropdown menu and upload your file.

4. Format & Examples: Sample Draft

Below is a standard legal format accepted by Tax Authorities. You can copy this on plain paper or a stamp paper of minimal value (e.g., ₹100 or ₹500), depending on local requirements in Bihar.

CONSENT LETTER (NO OBJECTION CERTIFICATE)

TO WHOM IT MAY CONCERN

This is to certify that I, [Name of Property Owner], s/o [Father’s Name], resident of [Full Home Address], am the legal owner of the premises located at:

[Full Address of the Premises with PIN Code]

I have NO OBJECTION to [Name of Business Owner / Applicant] using a portion/entirety of the above-mentioned premises for operating their business under the trade name M/S [Name of Business].

I further state that:

1. I am not charging any rent for this usage.

2. I have permitted the applicant to apply for GST Registration using this address.

3. The electricity bill bearing consumer number [Consumer ID] attached herewith belongs to me.

Signature of Owner: ___________________

Name: [Name of Property Owner] Date: [DD/MM/YYYY] Place: [City, State]

Note: Always attach the ID proof (PAN/Aadhaar) of the owner along with this letter.

5. Mistakes & Myths

Common Errors That Delay GST Registration

• Myth: “I don’t need a consent letter if I am the owner.”

  • Fact: Correct, but you need the property deed/tax receipt. If the deed is in your father’s name, you represent the business, not the owner—so you do need a consent letter.

• Mistake: Uploading only the Electricity Bill.

  • Consequence: The officer will issue a Notice (SCN) asking for “Proof of relationship with the premise owner.”

• Mistake: Signature Mismatch.

  • Consequence: If the signature on the consent letter looks vastly different from the ID proof of the owner, it raises suspicion.

• Mistake: Using a Shared Meter without NOC.

  • Consequence: In shared complexes, ensure the specific shop/room number is mentioned in the consent letter to avoid confusion with other businesses in the same building.

6. Expert Notes (EEAT)

From the Desk of Advocate Tabish Ahmad Advocate, Patna High Court | LL.M. (Taxation)

“In my decade of practice handling over 1000 tax matters, I have observed that 30% of GST applications in Bihar are held up due to documentation errors regarding the ‘Place of Business’.

The Department is increasingly using Geo-tagging and physical verification. If you submit a Consent Letter, ensure the owner is actually aware. Officers may visit the premise. If the owner denies knowledge of the business during a field visit, your GSTIN can be cancelled ab-initio (from the start) for suppression of facts.

Pro Tip: If you are a tenant, do not try to use a Consent Letter to save on Stamp Duty. If money is being exchanged for the space, a Rent Agreement is mandatory. The Consent Letter is strictly for ‘blood relatives’ or cases where no rent is exchanged.”

7. Key Takeaways

• Essential for Home-Based Biz: Required when operating from a relative’s property.

• No Rent: Valid only when no rent is paid.

• Supporting Docs: Must be accompanied by an Electricity Bill or Property Tax Receipt.

• Format: Simple declaration signed by the owner (Notarization recommended).

• Rejection Risk: Missing this document triggers an immediate Show Cause Notice.

INTERNAL & EXTERNAL LINKING

Upward Link (Pillar):

• Read our complete guide on GST Registration Process and Fees to understand where this document fits in.

Sideways Links (Related Clusters):

• Learn about the requirements for a Rent Agreement for GST.

• Understand the rules for Adding an Additional Place of Business.

Downward Links (Local Pages):

• GST Services in Patna

External Link (Trust Signal):

• Verify your documents on the official GST Portal.