GST is an indirect tax that has been created to remove many other indirect taxes in India, to develop a single tax regime for ease of collection, and to improve the efficiency of the process. It is mandatory for companies with an annual turnover of Rs. 40 Lakh and above. In the North East and the Hill States, registration is obligatory for firms receiving more than Rs . 10 Lakh annual income.
In this blog, we will consider situations where additional records are required after submission of a GST application for registration, or a GST application is rejected.
But before that, let’s mention GST registration, its privileges, penalties associated, appropriate errors in GST registration, reregistration of GST
How do you benefit from registering a company under the GST?
- GST removes the cascading effect of tax
- Higher threshold for registration
- Composition scheme for small companies
- The simple and easy online process
- The number of compliances is lesser
- Defined treatment for E-commerce operators
- Improved efficiency of logistics
- The unorganized sector is regulated under GST
Are you aware of the fact that there is a fine for not registering on the GST?
According to section 122 of the CGST Act, if you are a taxable person and you do not enroll under the GST, you are legally bound by the GST Act and you must pay the following penalty:
10,000 INR or amount of tax evaded whichever is higher.
For example:-
Case1:- If you fail to register the GST and the total amount of tax avoided amounts to INR 30,000, then the penalty applicable is INR 30,000.
Case2:- If you fail to register the GST and the total amount of tax avoided amounts to 8,000 INR, then the penalty applicable is 10,000 INR
Errors In Your GST Registration?
If you have any mistakes or errors in the registration of the GST, you will fix them in the registration application either at the time of registration or afterwards. You must apply FORM GST REG-14 along with your records. The GST officer shall validate and authorise FORM GST REG-15 within 15 days.
But if there is an error in PAN, you will have to file a new registration for FORM GST REG-01. This is because the GSTIN number is based on the PAN number.
What happens if your GST registration is failed?
After submission for registration, you will obtain the GST Registration Certificate within 10 working days. However, certain candidates can need supplementary documentation to be submitted to the GST department for further confirmation. In rare cases, the application for registration of the GST may also be rejected.
How to know the reason for rejection of GST registration?
After submission of your application for registration of the GST along with a list of the necessary documentation, an acknowledgment will be given to you.
You can use the ARN number (Acknowledgement Reference Number) as shown in the GST Registration Application to monitor the status of your application.
It usually takes around 7 working days for the provisional GSTIN to be given and a further 2 days for the actual GSTIN to be provided with the GST registration certificate. If the processing officer accepts the submission, you can obtain the GST Registration Certificate as a soft copy.
Why did your GST Registration Submission Rejected?
Your GST submission will only be rejected if the necessary details are not filled in properly, if the name or address of the premises is not displayed correctly and if the PAN card number is not matched.
If the application for registration with the GST does not include all the required documentation or records, the GST officer processing the application will issue a notice requesting additional information or confirmation or documentation.
In such a case, the requested information or documentation referred to by the GST Officer must be sent to the common portal prior to the date stated in the note. The Approved Officer will accept the application after you have fulfilled the details you have given for the GST certificate. However, the Approved Officer has the right to deny the application for a GST certificate if you have not submitted all the necessary documentation or if you do not apply them on time.
The GST Officer can not request a personal hearing to issue a new GST certificate of registration. The GST officer shall disclose any details relating to the application process or any issues relating to the registration only via the GST form.
If you do not reply, or if the designated officer is not pleased with the reply, or if you do not answer well within the time period, the processing officer may deny the order.
If the officer is not pleased with the reply, he can refuse the application and make an order in FORM GST REG-05.
On rejection of the application for GST registration, the GST officer will give notice to the applicant. As per the GST Regulations, you should be informed in writing by the Designated Officer along with the grounds for rejection. You can now also download the GST rejection form.
Is your GST registration rejected? Worry Not ! This is How You Can Download GST Registration Rejection Order
If you have registered for GST registration and your application has been rejected, you will have the opportunity to reply to the letter of rejection.
However, if you want to apply for a new request, you will have to wait about 10 days for final rejection. Once the application is fully rejected you can apply again.
Cancellation Of GST Registration:
Your GST registration can be cancelled for the below reasons :
1. Cancellation by Taxpayer:-
A taxpayer opts in for cancellation of registration on the grounds of:
Liability: Registration of GST is mandatory for any company that crosses the threshold. However, if the annual revenue of the company falls below the threshold, the registered individual can opt-in to cancel the GST.
Merger: The taxpayer has transferred or combined the company with another organization, or vice versa). In this case, the transferee (or the new company from amalgamation/demerger) must be registered under the GST.
Dissolution: The taxpayer has discontinued the business.
Constitution: There is a change in the constitution of the business
For cancellation, the taxpayer would have to request an e-application to FORM GST REG-29 via the GST Portal. The approved officer shall, upon proper enquiry, arrange for the cancellation of the registration.
(Login to the GST Portal with your user-ID and password. Then navigate to the Services > Registration > Application for Cancellation of Registration option.)
2. Cancellation by Legal Heirs
If the registered person is deceased, the family or legal heir of the taxpayer may request the cancellation of the GST registration in FORM GST REG 16. Legal heirs are expected to provide the following information in FORM GST REG 16.
Information of the inputs, semi-finished, finished goods held in stock on the day of the cancellation of registration. Details of the payment.
3. Cancellation by Authorised Officer:
An Authorised officer can cancel GST registration of a taxpayer if,
- The registered person shall not conduct business from the location specified during registration.
- The registered person shall issue invoices without any supply of goods or services.
- The registered person violates anti-profiteering provisions
In order to cancel the registration of a given company, the designated officer must obey the protocol set out below.
- Authorized notifies the concerned individual by submitting a statement of cause in FORM GST REG-17.
- In the case of any dispute, the registered individual shall respond to FORM GST REG-18 within 7 days of the notification.
- If the authorised officer considers the reply to be satisfactory, he may withdraw the proceedings and render an order in FORM GST REG – 20.
- However, if you fail to explain why your registration should not be revoked, an order will be given by the designated officer in FORM GST REG-19. The order will be submitted within 30 days from the date of the reaction to the appeal.
Revocation of Cancellation under GST
In the event of cancellation by an authorised officer, you can request cancellation within 30 days from the date of the cancellation order.
The process you need to be aware of:
An application for cancellation may be sent to the GST portal via FORM GST REG-21.
If the designated officer is pleased with the explanation you give, the registered office is allowed to do so.
1. Document the basis for the cancellation of the registration in writing.
2. Reverse the cancellation of registration.
3. Pass an order of revocation in FORM GST REG-22.
However, if the explanation is not considered to be acceptable to the appointed officer, he can reject the application for revocation. The officer is required to order in FORM GST REG-05 and communicate the same.
Before rejecting the application, the responsible officer shall give a show cause notice in FORM GST REG–23 to show you that the application should not be rejected. You must respond to FORM GST REG-24 within 7 working days from the date of operation of the notification.
A decision shall be made by the responsible officer within 30 days from the date of receipt of the clarification in FORM GST REG-24.
Why Revocation Of Cancelled GST Registration Is Necessary:
If you do not apply for cancellation, it shall be considered to be a defect within the scope of Rule 9(2) of the 2017 Central Goods and Service Tax Rules and may be considered as a basis for rejection of the application for fresh registration.
In the other hand, if you continue to trade goods and supplies with GST authorization, it will be deemed a crime under GST regulation and you will be subject to serious penalties.
Steps To Re-Registration Under GST
CBIC (Central Board of Indirect Taxes and Customs) (released Vide Circular No. 95/14/2019-GST of 28 March 2019, in order to prevent the appeal for the re-registration of firms who have had their registration cancelled by an official due to non-compliance with the legislative requirements, where the officials have explained the implications that the taxpayer would have to face in the event of non-revoking.
In cases where a registered taxpayer asks for a further registration under the same State, the approved officer is expected to investigate whether the current registration remains or is cancelled;
In the case of cancellation of the registration, the further review shall proceed as to whether the registration is cancelled on the grounds of breach of the provisions of Section 29(2)(b) [composed dealer has not submitted returns for 3 successive tax period] or of Section 29(2)(c) [registered taxpayer has not given returns for a continuous duration of 6 months].
If you need more assistance with your rejected GST application, please feel free to contact us. Our team of GST Consultants in Bangalore will do everything possible to ensure that the GST application process continues.