Explore the latest notification on revocation of GST registration cancellation. Learn about the extended deadline, implications, and step-by-step procedures. Stay informed for compliance.
In accordance with Section 30 of The Central Goods and Services Tax Act, 2017 (‘Act’) any taxpayer (including composition taxable person as per Section 10 of the Act) whose GST registration has been cancelled voluntarily or Suo-moto by the proper officer, may apply for revocation of cancellation of registration within a period of 30 days from date of order of cancellation.
In the past, due to impact of COVID-19 pandemic, Central Board of Indirect Taxes and Customs (‘CBIC’) had extended the above time limit of 30 days to effectively 60 days (upto 30th September 2021). However, despite the extension there were many taxpayers who had missed the said date.
Broadly, there can be the below implications in case a taxpayer’s registration is Suo- moto cancelled by the proper officer and such taxpayer does not apply for revocation of cancellation of registration:
a. In case of a legal entity (other than individual), it loses right forever to seek fresh registration under any provisions of the Act.
b. In case of a natural person (individual), he/she loses right to seek fresh registration ever in lifetime under any provisions of the Act. There may be issues in obtaining registration even in case he/she is a directory/ partner/ authorized signatory of an entity whose registration was Suo moto cancelled.
c. Initiation of proceedings on the taxpayer for recovery of taxes, interest, late fees or penalty in accordance with Section 73 or Section 74 of the Act.
d. In certain extreme cases, the department may also launch prosecution proceedings against the taxpayer (imprisonment may extend upto 5 years)
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Recent Notification for extension of time limit for revocation of cancellation of GST registration
CBIC recently vide Notification 03/2023- Central Tax Dated 31st March 2023 has provided final opportunity to the certain class of taxpayers to make an application for revocation of cancellation of GST registration on or before 30th June 2023 in case it was Suo-moto cancelled by the proper officer. The class of taxpayers who may make an application are as below:
a. Composition taxable person registered under Section 10 of the Act whose registration is cancelled by the proper officer on account of non-filing of returns for 3 consecutive periods; or
b. Taxable person under normal provisions of the Act whose registration is cancelled by the proper officer on account of non-filing of returns for 6 consecutive months; and
c. Proper officer has cancelled the registration on or before 31st December 2022; and
d. The taxpayer has failed to make an application for revocation of cancellation, or the taxpayer has filed an appeal against the order of cancellation.
Procedure for making an application for revocation of cancellation
Step 1: File all the returns up to effective date of cancellation of registration. If any taxes or interest or late fees is pending to be paid, the payment of the same must be done vide a challan.
Step 2: File Form REG-21 by mentioning the reasons for revocation of registration along with an affidavit (on stamp paper duly notarized) stating that we assure to comply with all the provisions of the Act in future and there are no pending dues to be paid. If there are no transactions from date of cancellation order till date of making application for revocation of registration it should be mentioned in the above affidavit.
Step 3: The proper officer may approve the application on basis of the affidavit. However, if not satisfied may issue a show cause notice vide GST REG- 23 requesting the below for the period beginning from date of cancellation order till date of making application for revocation of registration:
- Details of purchases and sales; and
- Bank statement; and
- Challan for payment of taxes, interest, late fees or penalty.
Step 4: Approval and issue of order for revocation of cancellation of GST registration
Procedures to be followed post revocation of cancellation order
Once the GST registration is restored, all the returns which were due for the period from the date of the order of cancellation of registration till the date of the order of revocation of cancellation of registration shall be filed by the taxpayer within 30 days from the date of order of revocation of cancellation of registration. While filing the above GST returns, the taxpayer must pay the relevant late fees for each tax period.
The maximum late fees which can be levied are as below:
| Particulars | Amount per return/ per month (₹) |
| Nil Return | 500 |
| Other than Nil Return | |
| Annual turnover in the previous FY is upto ₹1.5 crore | 2,000 |
| Annual turnover in the previous FY is from ₹1.5 crore to ₹5 crore | 5,000 |
| Annual turnover in the previous FY is more than ₹5 crore | 10,000 |
Benefits for the revenue and taxpayer from this latest notification
- Revenue department can extract additional revenue from interest, late fees and penalty.
- Revenue department can save upon cost of recovery of taxes as the taxpayer shall itself make the payment before making an application.
- Taxpayer shall be free from burden of recovery of taxes and prosecution.
Ref: CBIC guide on Cancellation, Suspension and Revocation of cancellation of Registration
Notification 03/2023- Central Tax Dated 31st March 2023
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Disclaimer: The content of this document is for general information purpose only. I shall not accept any liability for any decision taken based on the article. You should carefully study the situation before taking any decision.
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