The liability to register under GST arises when aggregate turnover of a supplier exceeds threshold limits. The registered person acquires a 15-digit GSTIN from the tax authorities so that he is eligible to collect tax on behalf of the Government and thereby avail the benefit of Input Tax Credit.

Every registered person shall make a self-assessment of his output GST payable and furnish the same in his respective monthly / annual return after discharging the computed liability. Self Assessment under GST can be availed by every taxable person registered under the provisions of GST law, now the question arises whether an unregistered person can also opt for Self Assessment and pay tax, we can reconnect this here under:-

1. An unregistered person liable to get registered or where his registration has been cancelled may approach the concerned officer who shall provide best judgement assessment for the relevant period under section 63.

2. An unregistered person who is a director of a company or partner of a firm from whom dues cannot be recovered due to provisions under section 89 or 90 and similar provisions of Chapter XVI of CGST Act. In such cases the unregistered person shall obtain temporary number and discharge his tax liability.

Who are eligible to take Registration under GST: (Sec 22 to 24)

Topic Details
Section 22 Persons liable for Registration
  • Aggregate turnover of a supplier exceeds Rs. 20lakhs in a financial year
  • Aggregate turnover of supplier making taxable supply of  goods/ services or both from any special category states, as specified in sub-clause (g) of clause (4) of article 279A of the Constitution of India, exceeds Rs. 10 Lakhs / Rs.20 Lakhs in a financial year.
  • The Government may, at the request of a State and on the recommendations of the Council, enhance the aggregate turnover from 10lakh rupees to such amount not exceeding 20lakh rupees subject to such conditions and limitations, as may be notified.
  • The Government may, at the request of a State and on the recommendations of the Council, enhance the aggregate turnover from 20lakh rupees to such amount not exceeding 40lakh rupees in case of suppliers engaged exclusively in the supply of goods, subject to such conditions and limitations, as may be notified (if he is also engaged in exempt supply of services provided by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount, assessee shall be considered to be engaged exclusively in the supply of Goods)
Section 23 Persons not liable to register under GST
  • Persons engaged exclusively in the supply of goods/services or both that are not liable to tax or wholly exempt from tax.
  • An agriculturist, to the extent of supply of produce out of cultivation of land.
Section 24 Compulsory registration in certain cases 
  • Persons    making     Inter-state     taxable    supply     (except handicraft goods)
  • Casual   taxable   persons   making taxable     supply   (except
    handicraft goods)
  • Persons liable to pay tax under reverse charge
  • E-commerce operators
  • Non-resident taxable persons making taxable supply
  • Persons deducting TDS
  •  Persons making taxable supply as agent or otherwise
  • Persons supplying online information and database access or retrieval services from outside India to a person in India

Categories of Assessment under GST:

Topic Details
Section 59 Self-Assessment Every registered person shall self-assess taxes payable under this Act and furnish a return for each tax period as specified under section 39
Section 60 Provisional
When a taxable person is unable to determine the value of goods/services or both or the rate of tax applicable on such transaction, he may request to the concerned authority for provisional assessment of tax. Once approved, a bond shall be executed binding the taxable person for payment of the difference between the amount of tax as may be finally assessed and the amount of tax provisionally assessed.
Section 61 Scrutiny Assessment This section deals with the powers vested upon the concerned  officer   who  conducts  scrutiny   if any discrepancy  arises  in  the   returns  and    related information. The officer shall send a notice quantifying the amount of tax, interest and any other amount payable in  relation to such discrepancy, wherever possible.

The assessee shall provide an explanation within 30 days from receipt of such notice. On failure to provide satisfactory explanation,   the   officer  shall   initiate Demand and Recovery proceedings under Sec 73 and 74 or any action deemed necessary.

Section 62 Assessment of Non- filers of returns When a registered person fails to furnish return even after service of notice to return defaulters under section 46, the officer shall issue an assessment order based on the best of his judgment taking into account all the relevant documents which are available or has been gathered. Such order may be issued within 5years from the due date of furnishing annual return.
Section 63 Assessment              of unregistered persons Where a taxable person fails to obtain the GST registration or whose registration has been cancelled under Section 29(2) but such person is liable to pay tax, the concerned officer may assess the tax liability to  the    best  of    his  judgement   after    providing
opportunity of being heard to such person or issue an Assessment order within a period of five years from the due date of furnishing annual return for the FY for which the tax has not been paid.
Section 64 Summary Assessment in special cases The concerned officer on availability of any evidence showing tax    liability    with    prior    permission    of  Additional Commissioner or Joint Commissioner, may proceed to assess the tax liability of such person to protect  the  interest    of  revenue    and   issue  an assessment order,  if he has sufficient grounds to believe that any delay in doing so may adversely affect the interest of revenue.

Order of Discharge of Self Assessment: Section 49(8)

Every taxable person shall discharge his tax and other dues in the following order:

Every taxable person shall discharge his tax and other dues in the following order

Section 73: deals with determination of tax and its demand & recovery under certain circumstances other than fraud or any wilful misstatement or suppression of facts such as:-

  • Tax not paid; or
  • Tax short paid; or
  • Tax erroneously refunded; or
  • Input tax credit wrongly availed or utilized.

Section 74: deals with determination of tax and its demand & recovery under certain circumstances by reason of fraud or any wilful misstatement or suppression of facts such as:-

  • Tax not paid; or
  • Tax short paid; or
  • Tax erroneously refunded; or
  • Input tax credit wrongly availed or utilized; or
  • Willful misstatement; or
  • Suppression of facts

Self Assessment beyond Section 39:

Self Assessment is neither restricted to mere furnishing of return in Form GSTR-3B under Section 39 nor is the sole requirement under Section 59. A registered person can self assess and make payment of any additional outward liability at the time of filing Annual Return in Form GSTR-9 under Section 44 for every financial year on or before 31st December.

Section 73(5) and Section 74(5) provides for voluntary payment of tax before service of notice by the proper officer. A person chargeable with tax may choose to pay the amount of tax along with interest payable and penalty, if applicable, on the basis of self assessment or as ascertained by the officer. The person chargeable with tax shall inform the officer in Form GST DRC-03 and an acknowledgment accepting such payment shall be issued by the officer in Form GST DRC-04.

Claim of Input Tax Credit: Section 41

Every registered person shall be entitled to take eligible input tax credit and such amount shall be credited to his electronic credit ledger to be utilized for paying tax liabilities in the order as provided in Rule 88A of CGST Amendment Act, 2018.

Available Input Tax Credit First set off on Output liability Next set off on Output liability
(in any order)

Rule 36(4) provides that ITC not exceeding 20% of the ITC available on the basis of details appearing in Form GSTR-2A. However, restriction has been imposed on the ITC eligibility to a

Rule Topic Details
Rule 143 Recovery by deduction from any money owed The specified officer shall deduct  the outstanding amount owing to a defaulter subject to section 79(1)(a).
Rule 144 Recovery by sale of goods under the control of proper officer The proper officer shall prepare an inventory of a defaulter subject to section 79(1)(b) and sell requisite amount of goods for  recovering  the outstanding amount including administrative expenditure.
Rule 145 Recovery from a third person The proper officer may direct a third person subject to section 79(1)(c) directing him to deposit the amount specified in the notice. Upon successful payment, the officer shall issue a certificate indicating the details of liability so discharged.
Rule 146 Recovery through execution of a decree The proper officer shall send a request to the Civil Court where any amount is payable by the defaulter. The said court shall execute the attached decree and credit the net proceeds for settlement of the amount recoverable.
Rule 147 Recovery by sale of movable or immovable property The proper officer shall prepare a list of the movable and immovable property of the defaulter and estimate their market value. He shall prohibit any such sale or transaction of the properties towards recovery of the outstanding amount.    Such   property shall  be sold
through auction.

Disclaimer: Nothing contained in this document is to be construed as a legal opinion or view of Praveen Surana & Associates whatsoever and the content is to be used strictly for educative purposes only.

Author Bio

Qualification: CA in Practice
Company: Praveen Surana and Associates
Location: Kolkata, West Bengal, IN
Member Since: 21 Nov 2020 | Total Posts: 1

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November 2020