Dear readers, hoping that you are all well in this situation of the pandemic. This pandemic has hit the slow-moving Indian economy and MSME Sector very hard. The Government of India is very much concerned about the economy and has taken many steps to revive the Indian economy as soon as possible. A few Months back; RBI and Finance Ministry has announced many schemes like loans for MSME Sector etc. In continuation of that relief packages, GST department has given relief to normal dealers as well as GST return defaulters who want to become part of mainstream of the business community.

The GST department has waived off late fee of all dealers in case, they have nil return to file and capped Rs.500/- late fee in case of other than nil return late fee cases. The most beneficial relief is given to those dealers whose GST has been Suo moto cancelled by GST Officer and dealer has not filed revocation request within the specified time period. In this article, we will discuss the situations in which GST Registration will be suo moto cancelled by GST Officer and how these defaulting dealers can take benefits of this one time scheme for revocation of their cancelled GST.

Revocation of cancellation of Registration

GST registration Cancellation process has been governed by Section 29 of CGST Act, 2017. Section 29 (2) of CGST Act, 2017 empowers a GST Officer to cancel the GST Registration of a dealer if he contravenes the provisions of GST Act. As per Section 29 (2) the proper officer 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 returns 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 obtained 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 

In past view months, GST Officers has cancelled GST registration of GST return defaulters using the power given by this section. If GST Registration of any dealer is cancelled Suo Moto by GST Officer then Section 30 of CGST Act 2017 read with rule 23 of CGST Rules 2017 gives an opportunity to GST dealer to apply for revocation of his cancelled GST within 30 days from the date of service of the cancellation order, after rectifying the error/reason due to which GST Registration has been cancelled by GST Officer.

For GST Revocation purpose, the dealer has to 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.

From a practical point of view, it was observed in many cases that, GST dealer is not aware about the compliances to be done by dealers after GST registration. Due to this unawareness, he has not filed GST Returns and after the specified period, his GST has been cancelled by the officer. When he comes to know about his GST Registration cancelled, at that time either the GSTR-3B late filing fee is so high that, it is out of control of that small dealer to pay that late filing late fee to apply for revocation of GST or the time period specified by Section 30 of CGST Act 2017 (30 days) has already expired, so he is not eligible for filing revocation request.

Now, the GST department has given a one-time golden opportunity to these defaulting GST dealers, who are not able to file GST revocation request due to any reason (maybe due to the high amount of late fee or period of 30 days for submitting GST Revocation request is over).

As per Notification No. 52/2020 – Central Tax Dt-24th June 2020, a late fee of a registered person who failed to furnish the return in FORM GSTR-3B for the months of July 2017 to January 2020, by the due date but furnishes the said return between the period from 01st day of July 2020 to 30th day of September 2020, the late fee amount shall be restricted to Rs.250/- per Month. Similarly, the late fee is also restricted to Rs.250/- per month in case of SGST/IGST Act.

Further, the late fee is completely waived off, if GST registered dealer file nil FORM GSTR-3B for the months of July 2017 to January, 2020, between the period from 01st day of July 2020 to 30th day of September 2020

To give relief to registered dealers whose GST has been Suo Moto cancelled, as decided in 40th GST Council meeting, an opportunity has been provided for filing of application of registration up to 30.09.2020, in all cases where registration has been cancelled till 12.06.2020

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 –shivsharma786@gmail.com and Mobile/Whatsapp – 9911303737/ 9716118384

Author Bio

Qualification: CA in Practice
Company: Shiv Kumar Sharma & Associates
Location: Delhi, New Delhi, IN
Member Since: 03 Dec 2018 | Total Posts: 46
My Self CA. Shiv Kumar Sharma. I am a member of "The Institute of Chartered Accountants of India" since 2012. I have Qualified my B.Com (H) in 2010 And Cleared CS- Executive Exam in June 2013. Currently, I am in Practice and dealing in Direct and Indirect taxation along with ROC Compliances. View Full Profile

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