GST Revocation & GST Registration Cancellation –FAQ’s

Dear Friends, as we all are aware, due to COVID-19 impact our economy is running very slow and as per economist this year our GDP growth rate will be very low. During this lockdown period various queries are received from GST registered MSME Units related to GST registration cancellation on voluntary basis, due to business turnover falls below the specified threshold limit.

To solve queries of MSME Enterprises which are registered under GST law and wants to cancel their GST Registration voluntary basis and compliance of law in case where GST is cancelled by GST officer on Suo- Motto basis, I have prepared some FAQ’s about which you must be aware.

Q 1. Whether I have to file Monthly GST Return or on quarterly basis? Last year, GST Council has proposed to implement new GST Return system in which small dealers have to file GST Returns on quarterly basis.

Ans: All dealers have to file GSTR-3B on monthly basis and GSTR-1 on Monthly/Quarterly basis. New GST Return proposed by GST Council is still under trial mode and not implemented till date.

Q 2. As my turnover limit is below threshold limit, whether it is mandatory to file GST returns? And if I do not file GST Returns is there any late fee/ penalty can be levied.

Ans: Dear dealers, till the date your GST number is active, you are required to file your GST returns even though your turnover is below threshold limit. If you do not file your GST returns timely, you are required to pay late fee of Rs.20/50 per day as applicable. And in case of continuous default in filing of GST return, your GST registration is liable for Suo-Motto cancellation by GST Officer.

Q 3. I have made taxable supply under my GST number, but not filed GST return for continuous 6 Months and my GST number has been suo-motto cancelled by officer. Whether, I am liable to deposit the collected GST amount with department?

Ans: Suo-Motto cancellation of GST Registration does not mean that, you have been relieved from all activities done prior to date of GST registration cancellation. If you have collected the tax from consumers against your GST registration, then you are required to deposit the same with GST Department along with interest on late deposition of taxes.

Q 4. Due to default in filing GST returns, my GST registration has be suo-motto cancelled by GST officer. But I want to continue my GST registration, what I have to do now.

Ans:  If you want to continue your GST Registration, then you have to file GST Registration revocation request with your officer within 30 days of cancellation of your GST Registration.

Q 5. My GST Registration has been cancelled by GST officer, however, I am still running my business and raising taxable invoice. What are the consequences, if I still doing the same?

Ans: When your GST Registration has been cancelled then you are not authorized to collect any taxes from consumer. If you are still collecting taxes from consumer, it is against law and government has the power to recover the whole tax amount along with interest and levy penalty on the dealer for doing fraud activities.

Q 6.  Due to economical conditions, my business turnover is below threshold limit and I want to cancel my GST Registration, please suggests what I have to do in this situation.

Ans: If you want to cancel your GST Registration, then you have to make an application with your GST Officer online in specified form, explaining the reason why you want to cancel the GST Registration. You have to apply for GST Cancellation within 30 days of closure of business.

Q 7.  Few months back, I have applied for Voluntary GST Cancellation and the same is approved by my GST officer. Now, I want to start my business again. Whether I can go for GST Revocation request?

Ans: GST Revocation request is allowed only in case when GST Registration has been cancelled by GST Officer on his own motion. If you GST Registration have been cancelled on your own request, you cannot go for GST Revocation request. You have to apply for new GST Registration.

Q 8.  I am GST Registered dealer but now my turnover is below threshold limit and I want to surrender my GST Registration. I have a very low interstate turnover.

Ans:  If you want to surrender your GST Registration then you are allowed to do so. But, as per GST law, if you are making Interstate supply then it is mandatory to have GST Registration. In your case, if you still want to continue interstate sale then you are not allowed for surrender of GST registration.

This article is for the purpose of information and shall not be treated as a solicitation in any manner and for any other purpose whatsoever. It shall not be used as a legal opinion and not be used for rendering any professional advice. This article is written on the basis of the author’s personal experience and provision applicable as on date of writing of this article. Adequate attention has been given to avoid any clerical/arithmetical error, however; if it still persists kindly intimate us to avoid such error for the benefits of other readers.

The Author “CA. Shiv Kumar Sharma” can be reached at mail –[email protected] and Mobile/Whatsapp – 9911303737/ 9716118384