GST registration by Insolvency professional

Government has laid down a special procedure u/s 148 of the CGST Act, through Notification no. 11/2020- Central Tax, dated 21.03.2020 which says that every IRP or RP has mandatorily need to apply for a fresh registration application under GST for each state where the corporate debtor was earlier registered within 30 days of his date of appointment or if his appointment has already been done before this date of notification, he has to apply for the fresh registration within 30 days of the date of this notification which later got relaxed vide Notification no. 39/2020- Central Tax, dated 05.05.2020 by 30^th June, 2020.

However, as per the Notification no. 39/2020- Central Tax, dated 05.05.2020, it is important to be noted that no new fresh application for GST registration is required, if the corporate debtor has already been filed the returns prescribed u/s 37 and 39 of the CGST Act, 2017 for all the tax periods prior to the appointment of IRP/RP.

Now let us understand the clarifications which government had introduced by bringing Circular no. 134/04/2020 and Circular No. 138/08/2020 for the above- mentioned notifications-

Query 1- Is IRP/RP liable for the GST compliances for the pre-CIRP period and how the dues of that period be dealt?

Clarification- No, IRP/IP are not liable to file any returns of the pre-CIRP period. And the dues of the period prior to the commencement of CIRP will be treated as an “Operational Debt” and claims may be filed by the officer before the NCLT for the same.

 Query 2- What will happen to the existing GSTIN of the corporate debtor?

Clarification- Existing registration will not be cancelled. However, officer, if needed, may suspend the registration which will debar the corporate debtor to make any taxable supply on his existing GSTIN and will also need not to file any of the returns prescribed under the CGST Act, 2017.

Query 3- Is IRP/IP need to comply for the period from his date of appointment till the date of the new registration granted?

Clarification- Yes, IRP/IP has need to be ensured that he has to file the return and comply with the provisions of the GST law after obtaining new registration also for the period beginning the date on which he became liable to take registration till the date on which registration has been granted by filing the First Return prescribed u/s 40 of the CGST Act, 2017.

Query 4- Is IRP/IP eligible to claim ITC for the invoices of the period post his appointment as IRP/IP and before the date of this Notification no. 11/2020- Central Tax, dated 21.03.2020 and whether he is eligible to claim refund of the amount deposited in Electronic cash ledger for the said period?

Clarification- As we understood from clarification no. 3, while filing his first return u/s 40 of the CGST Act, 2017, he is eligible to claim the ITC for those invoices as well which bearing the GTSIN of the earlier registered person by also overlooking of the ITC limitations prescribed u/s 16(4) and Rule 36(4) of the CGST Act. And any amount deposited by IRP/RP in said period in the cash ledger of the earlier GSTIN, is also eligible for the refund under the GST law and the condition of filing of all pending returns for claiming the refund under normal provisions has also been dispensed with.

Query 5- What will happen if IRP/IP appointed earlier and got replaced by the RP after obtaining the new GST registration?

Clarification- No new GST registration is needed and the same can be done by filing an amendment of non- core field in the GST registration by replacing an earlier IRP as a primary authorised signatory with the new RP as an “primary authorised signatory”. Hence, only change in an authorised signatory is needed which can be done either by the company’s authorised signatory or by the concerned jurisdictional officer on request by IRP/IP.