The Government has extended timeline for filing of application for revocation of cancellation of registration to 30/09/2021, where filing thereof falls due during 01/03/2020 to 31/08/2021, vide Central Tax Notification 34/2021 dt. 29/08/2021 (Partial Modification of Notifications No. 35/2020 Central Tax, dated 03/04/2020 and No. 14/2021 Central Tax, dated 01/05/2021), in the cases where registrations have been cancelled under clause (b) or clause (c)of sub-section (2) of section 29 of the Central Goods and Services Tax Act, 2017 (hereinafter referred to as “CGST Act, 2017”).

Cancel Reject GST registration

The benefit of this notification is extended to all cases in which registration has been cancelled under clause (b) or clause (c) of sub-section (2) of section 29 of the CGST Act, 2017, and the due date for filing an application for revocation of cancellation of registration falls between March 1, 2020 and August 31, 2021.

Pursuant to sub-section (2) of section 29 of the CGST Act, 2017, the proper office may cancel the registration of a person from such date, including any retrospective date, as he may deem fit, where-

(a) A registered person has contravened such provisions of the Act or the rules made thereunder as may be prescribed; or

(b) A person paying tax under section 10 has not furnished return for three consecutive tax periods; or

(c) Any registered person, other than a person specified in clause (b), has not furnished returns for a continuous period of six months; or

(d) Any person who has taken voluntary registration under sub-section (3) of section 25 has not commenced business within six months from the date of registration; or

(e) Registration has been granted by means of fraud, wilful misstatement or suppression of facts;

Provided that the proper officer shall not cancel the registration without giving the person an opportunity of being heard.

Provided further that during pendency of the proceedings relation to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.

Revocation of cancelation of registration

As per section 30 of the CGST Act, 2017, a 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 within thirty days from the date of service of the cancellation order.

Further, as per Rule 23 of the Central Goods and Services Tax Rules, 2017 (hereinafter referred to as the “CGST Rules”), a registered person may submit an application for revocation of cancellation of registration, in FORM GST REG -21 to such proper officer, within a period of thirty days from the date of the service of the order of cancellation of registration at the common portal.

It is to be noted that vide Finance Act, 2020, Section 30 of the CGST Act, 2017 was amended and the same has been notified we.f. 01.01.2021 vide Notification No. 92/2020- Central Tax, dated 22.12.2020. The amended provision provides for extension of time limit for applying for revocation of cancellation of registration on sufficient cause being shown and for reasons to be recorded in writing, by:

(a) the Additional or Joint Commissioner, as the case may be, for a period not exceeding thirty days;

(b) the Commissioner, for a further period not exceeding thirty days, beyond the period specified in clause (a) above

Consequently, changes have also been made in Rule 23 and FORM GST REG-21 of the CGST Rules, vide Notification No. 15/2021- Central Tax, dated 18.05.2021. The amended Rule 23 is as under-

“A registered person, whose registration is cancelled by the proper officer on his own motion, may submit an application for revocation of cancellation of registration, within a period of thirty days from the date of the service of the order of cancellation of registration at the common portal, or within such time period as extended by the Additional Commissioner or the Joint Co     mmissioner or the Commissioner, as the case may be, in exercise of the powers provided under the proviso to sub-section (1) of section 30.” (Italics & Bold portion inserted by CGST (4 Amendment) Rules,2021 vide Notification No. 15/2021-Central Tax, dated 18.05.2021)

First proviso to sub-rule (1) of Rule 23 of the CGST Rules provides that if the registration has been cancelled on account of failure of the registered person to furnish returns, no application for revocation of cancellation of registration shall be filed, unless such returns are furnished and any amount in terms of such returns is paid. Thus, where the registration has been cancelled with effect from the date of order of cancellation of registration, all returns due till the date of such cancellation are required to be furnished before the application for revocation can be filed.

Further, in such cases, in terms of the second proviso to sub-rule (1) of rule 23 of the said Rules, all returns required to be furnished in respect of the period from the date of order of cancellation till the date of order of revocation of cancellation of registration have to be furnished within a period of thirty days from the date of the order of revocation.

Where the registration has been cancelled with retrospective effect, the common portal does not allow furnishing of returns after the effective date of cancellation. In such cases it was not possible to file the application for revocation of cancellation of registration. Therefore, a third proviso was added to sub-rule (1) of rule 23 of the said Rules enabling filing of application for revocation of cancellation of registration, subject to the condition that all returns relating to the period from the effective date of cancellation of registration till the date of order of revocation of cancellation of registration shall be filed within a period of thirty days from the date of order of such revocation of cancellation of registration.

As per sub-rule (2) of Rules 23 of the CGST Rules, where the proper officer is satisfied, for reasons to be recorded in writing, that there are sufficient grounds for revocation of cancellation of registration, he shall revoke the cancellation of registration by an order in Form GST REG-22 within a period of 30 days from the date of the receipt of the application and communicate the same to the applicant. The proper officer may, for reasons to be recorded inwriting by an order in Form GST REG-05, reject the application for revocation of cancellation of registration and communicate the same to the applicant.

The proper officer shall, before passing the order referred to in clause (b) of sub-rule (2) [i.e. in case of rejection of application of revocation of cancellation of registration] issue a notice in Form GST REG–23 requiring the applicant to show cause as to why the application submitted for revocation should not be rejected and the applicant shall furnish the reply within a period of 7 working days from the date of the service of the notice in Form GST REG-24.

Remark: No fee is payable for filing application for revocation of cancellation.

Circular Title: Standard Operating Procedure (SOP) for implementation of the provision of extension of time limit to apply for revocation of cancellation of registration under section 30 of the CGST Act, 2017 and rule 23 of the CGST Rules, 2017.

The Government has issued a Circular No. 148/04/2021-GST dated 18th May, 2021 to provide Standard Operating Procedure (SOP) for implementation of the provision of extension of time limit to apply for revocation of cancellation of registration under section 30 of the CGST Act, 2017 and rule 23 of the CGST Rules, 2017

As has been provided in section 30 of the CGST Act, any registered person whose registration is cancelled by the proper officer on his own motion, may apply to such officer in FORM GST REG-21, for revocation of cancellation of registration within 30 days from the date of service of the cancellation order. In case the registered person applies for revocation of cancellation beyond 30 days, but within 90 days from the date of service of the cancellation order, the following procedure is specified for handling such cases:

4.1. Where a person applies for revocation of cancellation of registration beyond a period of 30 days from the date of service of the order of cancellation of registration but within 60 days of such date, the said person may request, through letter or e-mail, for extension of time limit to apply for revocation of cancellation of registration to the proper officer by providing the grounds on which such extension is sought. The proper officer shall forward the request to the jurisdictional Joint/Additional Commissioner for decision on the request for extension of time limit.

4.2 The Joint/Additional Commissioner, on examination of the request filed for extension of time limit for revocation of cancellation of registration and on sufficient cause being shown and for reasons to be recorded in writing, may extend the time limit to apply for revocation of cancellation of registration. In case the request is accepted, the extension of the time limit shall be communicated to the proper officer. However, in case the concerned Joint/Additional Commissioner, is not satisfied with the grounds on which such extension is sought, an opportunity of personal hearing may be granted to the person before taking decision in the matter. In case of rejection of the request for the extension of time limit, the grounds for such rejection may be communicated to the person concerned, through the proper officer.

4.3 On receipt of the decision of the Joint/Additional Commissioner on request for extension of time limit for applying for revocation of cancellation of registration, the proper officer shall process the application for revocation of cancellation of registration according to the law and procedure laid down in this regard.

5. Procedure similar to that explained in paragraph 4.1 to 4.3 above, shall be followed mutatis-mutandis in case a person applies for revocation of cancellation of registration beyond a period of 60 days from the date of service of the order of cancellation of registration but within 90 days of such date.

6. The circular shall cease to have effect once the independent functionality for extension of time limit for applying in FORM GST REG-21 is developed on the GSTN portal.

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Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of either of the author whatsoever and the content is to be used strictly for informational and educational purposes. While due care has been taken in preparing this article, certain mistakes and omissions may creep in. the author does not accept any liability for any loss or damage of any kind arising out of any inaccurate or incomplete information in this document nor for any actions taken in reliance thereon.

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