1. Exclusion of Input Service Distributors (ISD) & OIDAR
Rule 1(1) of draft GST Registration Rules provides that every person (other than a non-resident taxable person, a person supplying online information and data base access or retrieval services from a place outside India to a non-taxable online recipient referred to in section 14 of the Integrated Goods and Services Tax Act, a person required to deduct tax at source under section 51 and a person required to collect tax at source under section 52) who is liable to be registered under sub-section (1) of section 25 and every person seeking registration under sub- section (3) of section 25 (h ere in af er referred to in this Chapter as “the applicant”) shall, before applying for registration, declare his Permanent Account Number (PAN), mobile number, e-mail address, State or Union territory in Part A of FORM GST REG-01 on the Common Portal either directly or through a Facilitation Centre notified by the Commissioner.
Issue
- ISD does not avail credit nor charge tax. Hence registration process of ISD must be distinct from that applicable to taxable persons.
- Rule 1(1) excludes “a person supplying online information and data base access or retrieval services from a place outside India to a non-taxable online recipient referred to in section 14 of the Integrated Goods and Services Tax Act” from the list of applicant.
Section 14 of the IGST Act contains the phrase “supply of online information and database access or retrieval services by any person located in a non-taxable territory and received by a non-taxable online recipient”.
Suggestions
- It is suggested that ISD be also included in the excluded list and separate registration provisions be provided for ISDs.
- It is suggested that the words “place outside India”in Rule 1(1) be replaced by “nontaxable territory”to make both the provisions aligned with each other.
2. Registration of persons having one PAN carrying any business in more than one trade name at different locations in a state
Persons having one PAN and carrying business in more than one trade name at different locations in a state are facing problem in view of provision of only one trade name in GST REG-01 and GST REG-06. It is to b noted that more than one business may be there for Different place / same Location as at one place more than one business can also be carried out.
Suggestion
It is suggested that provision for trade name be made available in column 16 of GST REG-01 requiring information of additional place of business and Annexure B of GST REG-06 certifying place of business of the person. It will enable the person to continue to carry business in different trade name at different place within the same state having one GSTN.
3. Cancellation of Registration
Rule 13 of draft GST Registration Rules provides that the registration granted to a person is liable to be cancelled if the said person
(a) does not conduct any business from the declared place of business; or
(b) issues invoice or bill without supply of goods or services in violation of the provisions of this Act, or the rules made thereunder.
Issue
The conditions for cancellation of registration are already provided for under section 29 of the CGST Act, 2017.
Suggestion
It is suggested that the conditions pertaining to cancellation be provided at one place only either in rules or in the Act as duplication might lead to interpretational issues.
4. Date of cancellation prescribed under Rule 14(3) to be amended
Rule 14(3) of draft GST Registration Rules provides that where a person who has submitted an application for cancellation of his registration is no longer liable to be registered or his registration is liable to be cancelled, the proper officer shall issue an order in FORM GST REG-18, within 30 days from the date of application submitted under sub-rule (1) of rule 12 or, as the case may be, the date of reply to the show cause issued under sub-rule (1), cancel the registration, with effect from a date to be determined by him and notify the taxable person, directing to pay arrears of any tax, interest or penalty including the amount liable to be paid under sub-section(5) of section 29.
Issue(s)
- In all these cases the proper officer is entitled to cancel the registration with effect from a date to be determined by him. This provisions gives freedom to the proper officer even where application for cancellation is moved by registered taxable person himself. In such cases, effective date should be the date from which the registered taxable person seeks cancellation. There may be a capping of period as prescribed in rule 12 to prevent late applications. But the complete power in this regard should not be vested in the hands of proper officer.
- Sub-rule (3) of Rule 14 makes a reference to an application 31ubEPtteH unHerL1ub-rule (1) Rf Lule 1O”. Rule 12 deals with application for cancellation of registration but has no sub-rule.
Suggestions
- It is suggested that Rule 14(3) be redrafted as follows:
Where a person who has submitted an application for cancellation of his registration is no longer liable to be registered or his registration is liable to be cancelled, the proper officer shall issue an order in FORM GST REG-18, within thirty days from the date of application submitted under rule 12 or, as the case may be, the date of reply to the show cause issued under sub-rule (1), cancel the registration, with effect from the date of occurrence of event as specified in rule 12 where application is submitted in accordance with rule 12 and with effect from a date to be determined by him in any other cases and notify the taxable person, directing to pay arrears of any tax, interest or penalty including the amount liable to be paid under sub-section(5) of section 29.
- Further, drafting anomaly of Rule 14(3) with regard to Rule 12(1) be rectified.
5. Physical Verification of Business Premises
Rule 17 of draft GST Registration Rules provides that where the proper officer is satisfied that the physical verification of the place of business of a registered person is required after grant of registration, he may get such verification done and the verification report along with other documents, including photographs, shall be uploaded in FORM GST REG-29 on the Common Portal within 15 working days following the date of such verification.
Issue
Physical verification of exiting registered premises will result in more administrative efforts and cost. Further, situations making the proper officer believe that physical verification of premises is required have not been provided for.
Suggestions
- It is suggested that verification of existing registered premises be avoided.
- Further, situations making the proper officer believe that physical verification of premises is required be clearly enlisted.
6. General Suggestions related to Registrations
- It is suggested that the decoding of GSTIN be provided as to which character is alphabetic and which is numeric.
- It is suggested that requirement of having name board with GSTIN as per Rule 10 be removed as it can be procedurally cumbersome and may be misused by certain categories of person.
