The heading is itself self explanatory. This post is all about getting registered for Goods and Services Tax payment. As you proceed further you will learn who should get registered and what laws are applicable.
Topics:
- Who are liable to take registration? (Section 22 of Central Goods and Service Tax, 2017)
- Who need not get registered in Goods and Service Tax?
- Compulsory registration
- Procedure for registration
- Distinct Person concept:
- Voluntary registration:
- Deemed Registration:
- Cancellation of registration:
- Input Tax Credit reversal on cancellation of registration
- Status of liability on cancellation of registration
- Revocation of application
- Conclusion:
1. Who are liable to take registration? (Section 22 of Central Goods and Service Tax, 2017)
Who should take registration? We have discussed it in the below mentioned points
- All the supplier having annual turnover more than Rs. 20 lakhs get registered in the Goods and Service Tax Act. This limit of Rs. 20 lakhs is not applicable for special category states. They get registered if they reach an annual turnover of Rs. 10 lakhs. Government has powers to change this limit for special category states if any one such state requests the government for the same. However the government may not peg this cut off above Rs. 20 lakhs which is presently the requirement for non special category states.
If you are wondering who are the special category states let you go through the below mentioned list of such states.
- Arunachal Pradesh
- Uttarakhand
- Nagaland
- Assam
- Meghalaya
- Mizoram
- Himachal Pradesh
- Sikkim
- Tripura
- Manipur
- Jammu and Kashmir
- A person already registered in the previous act –Excise, Service Tax, Vat etc.- should get himself registered in the Goods and Service Tax Act unless he has discontinued his business.
- A person transfers his already registered business in GST regime to another person either due to death of the business owner or for any other reason. In such a scenario the new business holder or the transferee shall get the business registered in Good and Service Tax Act.
- A business often gets transferred by means of merger, acquisition, amalgamation or order of court/ tribunal. Here too the transferee should get his business registered under Goods and Service Tax Act.
Notification 10/2019 Central Tax dated 07.03.2019 exempts any person engaged exclusively in supply of goods from taking registration if his aggregate turnover in that financial year less than Rs.40 lakhs. However the provisions of this notification shall not apply on
- Person liable for compulsory registration (discussed in section below).
- Person making supply of
| Sl. No. | Tariff Heading | Particulars |
| 1 | 2105 00 00 | Ice Cream, Edible ice |
| 2 | 2106 90 20 | Pan Masala |
| 3 | 24 | All goods i.e. Tobacco and manufactured tobacco products |
- Person making intra state supplies in the state of Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Nagaland, Pudducherry, Sikkim, Telangana, Tripura and Uttarakhand.
- Person exercising option of registration under section 25(3) of the CGST Act, 2017 (voluntary registration discussed below) or such persons who want to continue their registration under this Act.
2. Who need not get registered in Goods and Service Tax ?
In the previous section you have learnt who should get registered. Now it is time to know who are not liable for any registration in GST. Section 23 of Goods and Service Tax, 2017 is the reference for this list mentioned below.
- Any person supplying exempted goods and services need not take registration under GST. The only condition being the goods or services supplied by such person should be wholly exempted and not partially exempted.
- The government felt it necessary to keep this set of people in our society out of the tax ambit. They are the agriculturist. The agriculturist is exempted from taking registration under GST but only to the extent of their agricultural supply.
If the last sentence seems a bit unclear let us clear it with an example
Suppose an agriculturist is supplying Rs. 15 lakhs worth of agricultural produce in a financial year. At the same time, he is also engaged in supplying Rs. 10 lakhs worth of iron bar in the same financial year. He may argue that his turnover of taxable iron bar supply is less than Rs. 20 lakhs which is the prescribed limit for taking registration. However the law looks at the total turnover rather than considering your taxable turnover. So is the turnover to be considered is Rs. 25 lakhs (15+10)? Yes, now you get it right. He has to get registered under the Act as the turnover is more than Rs. 20 lakhs (which is Rs. 25 lakhs).
- The government has power to exempt any person from obtaining registration but only on the recommendation of the Goods and Service Tax Council.
3. Compulsory registration
There is also a category of suppliers who has to get registered in Goods and Service Tax Act even if their total turnover in any financial year is below the prescribed cut off of Rs. 20 lakhs. They are the persons liable for compulsory registration. Check out who are they
- Persons making interstate taxable supply.
- Casual taxable person doing taxable supply. Casual taxable persons are those persons who do not have a fixed place of business and occasionally make any supply. He may be principal supplier or an agent. There is a whole new post dedicated to casual taxable person which you may like to check out by following this link.
- A person who pays tax under reverse charge mechanism should get registered irrespective of his turnover in any financial year.
- Persons who are required to pay tax under section 9(5) of Central Goods and Service Tax Act, 2019 has to take compulsory registration. They are the e-commerce operators.
- Any non-resident taxable person making taxable supply.
- Any person who deduct tax at source under the provisions of Section 51 of Central Goods and Service Tax Act, 2017.
- Input Service Distributor has to take compulsory registration to distribute input tax credit.
- Person who supply goods or services through electronic commerce operators who are required to collect tax at source under section 52 of the Act.
- Every e-commerce operator who is required to collect tax at source under section 52 of the Central Goods and Service Tax Act, 2017(CGST, 2017).
- Person supplying online information and database access retrieval service from outside India to a person in India who is not registered.
- The last point is obvious. The Government has all the powers to specify from time to time any category of suppliers who are required to take compulsory registration.
4. Procedure for registration
Once you understand who are liable and who are not liable to take registration you should know the process of registration.
A person who is liable to be registered in Goods and Service Tax, 2017 shall apply for registration within 30 days from which he becomes liable for registration. Only casual taxable persons and non-resident taxable persons have to apply 5 days prior to the day when they make a taxable supply.
A person seeking registration gets a single registration in a particular state for all its units in that state. If he seeks multiple registration then unit concerned with each registration are treated as distinct from each other rather than part of the same business. We shall read about it in more details in the next section.
It is to be noted that if the same person is engaged in more than one line of business then he needs to take registration for each business separately.
The last thing is that the registrant requires to have a PAN (Permanent Account Number) issued by the Income Tax Authorities. After registration the persons gets a UIN (Unique Identification Number). The taxable supplier uses this UIN to pay his GST.
This post is meant to build your concept on registration. Hence we would not go in details of the forms and registration formats which will be the topic for another post.
5. Distinct Person concept:
There are two scenarios where this discussion is relevant
- A person has obtained multiple registrations in a single state. In the instant case the units pertaining to each registration would be treated as distinct persons. Example: In state of Madhya Pradesh Unit 1 for a person is registered under GST. If another Unit 2 in the same state of the same person is registered under a separate registration in GST, then both Unit 1 and Unit 2 are considered as belonging to two distinct persons. However if both the units are registered under the same GST registration then they would be treated as belonging to a single person.
- If a person has registered a unit in one registration and has another unit in a different state registered in separate registration then both the units shall be treated as distinct persons.
6. Voluntary registration:
Even if a person who is not liable for registration may seek for registration and get it under Goods and Service Tax Act, 2017. Such registrations are called voluntary registrations. A business usually asks for voluntary registration to pass on the input tax credit they have to their customers.
7. Deemed Registration:
- On application for registration the officer of the department examines the details in the application for registration. If the information furnished is deficit of any document or any details present in the application appears to be incorrect then the officer concerned may ask for further clarification. Query for such clarification shall be raised in 3 days of application for registration. If the officer concerned fails to do that the registration shall be deemed approve.
- If for any reason the application for registration is rejected then the registration shall be deemed rejected.
8. Cancellation of registration:
The registration may be cancelled by the department on their own motion or if the application for cancellation is submitted by the registered person. The reason for cancellation of registration could be as follows:
- The business has been discontinued, transferred fully, amalgamated with other legal entity, demerged or disposed off. In such situations the existing GST registration cannot continue and needs to be cancelled.
- If the constitution of the business has been changed then the old GST registration has to be cancelled.
- The taxable person who was previously registered under section 22 and section 24 (already discussed above) of the Act is no longer required to be registered. In such case he may apply for cancellation of registration.
- If the registered person under Goods and Service Tax has contravened any provision of the Act or any rules under GST then the department may cancel the registration.
- If a person paying tax has not furnished the GST returns for 3 consecutive tax periods or six months of registration, then his registration is liable to be cancelled.
- Any person who taken voluntary registration but has failed to commence his business within 6 months from the date of registration.
- Any registration obtained by fraud, willful misstatement or suppression of facts is liable to be cancelled by the department. However the department has to give a fair opportunity to the registered person to present his case before cancellation of his registration.
9. Input Tax Credit reversal on cancellation of registration
If the registration of a person is cancelled by any reason mentioned above, the person has to pay an amount by debit in his electronic credit ledger. This amount shall be equal to the input tax credit contained in inputs lying in stock, semi finished goods, finished goods and capitals goods related to such business. The credit on capital goods must be calculated by reducing the value of capital goods by such percentage points as may be attributed to its age.
10. Status of liability on cancellation of registration
The cancellation of registration shall not affect the liability of the person to pay tax dues pertaining to period before the cancellation. If any liability has arisen before cancellation he needs to settle the liability.
11. Revocation of application
If any officer cancels a registration by on his own motion then the concerned person may approach the officer and present his case. If satisfied such officer may revoke the cancellation of registration.
12. Conclusion:
We have discussed registration in this post. If you are a person carrying on any supply in the taxable territory you need to know whether a GST registration is required or not. Inability to comprehend the requirement of registration can easily land a taxable person in troubled waters. The best strategy is to understand the law and take registration accordingly. If you have any query, suggestions or additions to the topic feel free to comment.
You may also read about supply concept in GST
You may like to read about GST Audit Form GSTR 9C
GST bare act pdf download
View Comments
While looking out for an appropriate article, which helps with GST registrations and its Values, is when I came across what you have written Sneha. Thank you for having such a positive approach for readers like me who, at some point feared GST. After going through your blog it gives more confidence I should say on all the dos and don’ts.