Cancellation of GST Registration and Its Revocation [GST Law & Practice B.Com 6th Sem CBCS Pattern Notes]

Suspension (Cancellation) of GST Registration [Section 29 of the CGST Act, 2017]

The following persons are allowed to cancel GST registration:

1) The registered person himself

2) By a GST officer

3) The legal heir of the registered person

1) Cancellation by the registered person taxpayer [Sec. 29(1)]:

Registered person under GST can himself/herself cancel their registration in any one of the following cases:

a) Business has been discontinued.

b) The business has been sold or transferred to some other party. That other party needs to register under GST.

c) There is any change in the constitution of the business (like Partnership firm now converted into Private Limited company and so on).

d) Turnover is not more than ` 20 lakh (` 10 lakh in the case of special category States except J&K).

e) As per Finance Act, 2020, Voluntary registration can be cancelled by proper officer on own or on application by registered person or his legal heir.

2) Cancellation by a GST officer [Section 29(2)]:

GST registration of a person or business can be cancelled by a proper GST officer in one of the following cases:

a) If the registered person has violated any of GST provisions or laws.

b) A composition registered person has not filed tax returns for three consecutive quarters.

c) A normal registered person who has not filed returns consecutively for six months.

d) A voluntarily registered person who has not commenced any business in the six months from the registration date.

e) If the registration is obtained by fraud methods, the proper officer has the right to cancel the registration with retrospective effect.

(3) The legal heir of the registered person:

The legal heir of the registered person can request cancellation through an application, in case of death of the person.

Procedure for Suspension (cancellation of) GST registration

a) Application for cancellation must be made to the proper officer in GST REG form 16. The voluntary registrations can only be cancelled after one year or more from the date of GST registration.

b) A proper officer can send the show cause / cancellation notice to a registered person in GST REG form 17.

c) The concerned person must reply back in this form within 7 days of notice explaining why his/her registration should not be cancelled in GST REG form 18.

d) GST REG form 19 will be used by the proper officer to issue a formal order for cancellation of registration. The order is to be sent within 30 days from the application date or from the date of response in GST REG 18 form.

e) If the proper officer is satisfied with the explanation, he can use GST REG form 20 form to drop the cancellation proceeding and pass a formal order.

Revocation of Suspension (cancellation) of Registration (Section 30)

Provisions’ relating to Revocation of Cancellation of Registration is contained in Section 30 which are as under:

1. Submission of application to apply to proper officer for revocation of cancellation of the registration: Section 30(1) states that subject to such conditions as may be prescribed, any registered person, whose registration is cancelled by the 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.

2. Right to proper officer to either revoke cancellation of the registration or reject the application: Section 30(2) states that 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. Revocation of cancellation of registration under one Act to be deemed to be a Revocation of cancellation under the other Act: Section 30(3) states that 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.