As per the section 24 of CGST Act 2017 there are certain cases when GST registration is required to be taken by the supplier of goods or services or both. In this section supplier has to get itself registered irrespective of the fact that it has aggregate turnover of 20 lakhs (10 lakhs in case of special category of states) or above. There have been certain notifications through which certain persons have been given relief by the government from compulsory GST registration

COMPULSORY GST REGISTRATION

Notwithstanding anything contained in sub-section (1) of section 22, the following categories of persons shall be required to be registered under this Act irrespective of the aggregate turnover,––

1. Persons making any inter-State taxable supply

Summary: As per the above provision if any person making inter-state “taxable” supply then irrespective of the amount of supply the person has to get itself registered.

Exemption from compulsory GST registration

  • Inter- state supply of service uptu 20 lakhs- As per notification no 10/2017, any person making inter state taxable supply of service and having an aggregate turnover to be computed on all India basis not exceeding an amount of 20 Lakhs (10 Lakhs for special category of states except J&K) in an financial year then he is not required to get itself registered. It also means that there is not exemption to supplier of inter-state supply of goods.
  • Exemption to “Job worker”- As per notification no 07/2017,the job worker engaged in making inter-state “supply of services” to a “registered person” as the category of person exempted from obtaining registration, however this notification is not so relevant due to schedule-II job work will always be considered as supply of service and exemption for supply of service has already been given through notification no 10/2017.

2. Casual taxable persons making taxable supply

Summary: As per section 24 of CGST Act 2017, a casual taxable person is required to obtain compulsory registration irrespective of the aggregate turnover in the previous year. However exemption has been given to person engaged in the supply of “Handicraft goods”. A casual taxable person making taxable supplies of handicraft goods is exempted from obtaining registration if aggregate turnover to be computed on all India basis not exceeding an amount of 20 Lakhs.

Casual taxable person meaning- As per sec 2(20) of CGST Act means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed place of business

3. Persons who are required to pay tax under reverse charge

Summary: As per the above provision a person who is required to pay tax under reverse charge has to take compulsory registration as he has to take registration to submit tax under reverse charge. However this important point should be taken into consideration that  Section 24 overrides sec 22 only so any person who is exclusively in the business under section 23 i.e. any person engaged exclusively in the business of supplying goods or services not liable to tax or wholly exempt from tax then he is not required to get himself registered.

4. Person who are required to pay tax under sub-section (5) of section 9

Summary: As per the above provision any person who is required to submit tax under section 9(5). As per section 9(5) specific categories of  intra-state services through e-commerce operators then e-commerce operators are required to pay GST hence they are compulsorily required to get registered. As they have to pay tax under reverse charge mechanism

5. Non-resident taxable persons making taxable supply

Summary: As per the above provision a non resident person who is making any kind of taxable supply in the taxable territory then he has to take compulsory registration.

As per section 2(77) of CGST Act 2017,”Non-resident taxable person” means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed place of business or residence in India;

6. Persons who are required to deduct tax under section 51, whether or not separately registered under this Act

Summary: A person who is required to deduct TDS the authorities as notified a department or establishment of the Central Government or State Government; or local authority; or Governmental agencies; or

such persons or category of persons as may be notified by the Government are required to get itself registered under GST compulsorily

7. Persons who make taxable supply of goods or services or both on behalf of other taxable persons whether as an agent or otherwise

Summary: A person who is working as an agent or otherwise and also making taxable supply then as per section 24 of CGST Act 2017 he has to compulsorily get registered so any kind of agent who is making taxable supply needs to get registered under GST immediately.As per section 2(5) of CGST Act 2017 “agent” means a person, including a factor, broker, commission agent, arhatia, del credere agent, an auctioneer or any other mercantile agent, by whatever name called, who carries on the business of supply or receipt of goods or services or both on behalf of another;

8. Input Service Distributor, whether or not separately registered under this Act

Summary: As per the above provision input service distributor has to get compulsory registration under GST. As per 2(61) of CGST Act 2017 “Input Service Distributor” means an office of the supplier of goods or services or both which receives tax invoices issued under section 31 towards the receipt of input services and issues a prescribed document for the purposes of distributing the credit of central tax, State tax, integrated tax or Union territory tax paid on the said services to a supplier of taxable goods or services or both having the same Permanent Account Number as that of the said office;

9. Persons who supply goods or services or both, other than supplies specified under sub-section (5) of section 9, through such electronic commerce operator who is required to collect tax at source under section 52

Summary: As per the above provision if a person makes supplies through electronic commerce operator other than 9(5) then the supplier is also required to get compulsorily registered under GST.

10. Every electronic commerce operator

Summary: As per the above provision electronic commerce operator has to get GST registration irrespective of the turnover in previous year.  “electronic commerce” means the supply of goods or services or both, including digital products over digital or electronic network. “electronic commerce operator” means any person who owns, operates or manages digital or electronic facility or platform for electronic commerce

11. Every person supplying online information and data base access or retrieval services from a place outside India to a person in India, other than a registered person

Summary: As per the above provision if a person is supplying online information and data base access or retrieval from outside India then that person has to get itself registered under GST irrespective of the turnover in the previous year. E.g. Netflix providing services outside India then Netflix has to get itself registered and pay taxes under normal charge.

12. Such other person or class of persons as may be notified by the Government on the recommendations of the Council

In case of any doubts in the current topic or provisions of Indirect taxation (GST and CUSTOMS) then you may contact us at abhutpurv@gmail.com

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