GST Revocation in India
The introduction of the Goods and Services Tax (GST) in India on July 1, 2017, marked a significant turning point in the country’s taxation system. GST aimed to simplify the complex web of indirect taxes that existed prior to its implementation, unifying them into a single tax structure. Businesses are impacted by GST, particularly those in the e-commerce sector, which has grown rapidly in recent years. Businesses, consumers, and legislators all need to comprehend the GST in light of the growing number of digital transactions and economic opportunities.
However, there may be some situations where businesses need to cancel or revoke their GST registration, either voluntarily or due to non-compliance. The revocation of GST registration refers to the process of reinstating the GST registration of a taxpayer that has been cancelled by the GST authorities.
In this guide, we shall understand the GST revocation process, the reasons for cancellation, eligibility criteria, and the steps involved in revoking GST registration. We will also discuss the implications of revocation, the timeline for the process, and the penalties associated with it.
What is GST Revocation?
GST revocation means restoring a GST registration that has been cancelled by the tax authorities. A business that no longer requires its GST registration can voluntarily apply for the cancellation, or the authorities can cancel the registration in cases of non-compliance with the tax laws.
Once the GST registration is cancelled, the taxpayer loses the ability to collect and pay GST, file GST returns, and avail of input tax credits (ITC). Revocation allows the taxpayer to resume these rights by restoring the cancelled GST registration.
Why Do GST Registrations Get Cancelled?
There are several reasons why a GST registration may be cancelled. These include:
- Failure to File Returns: If a taxpayer fails to file GST returns for a continuous period of six months, the authorities may cancel their registration.
- Non-Operational Business: If the business is no longer operational or has been closed without notifying the authorities, the GST registration will be cancelled.
- Failure to Pay Tax: If a registered person fails to pay the GST tax due for an extended period, the authorities may cancel the GST registration.
- Misrepresentation or Fraud: The tax authorities may cancel the GST registration if there is any misrepresentation or fraudulent activity.
- Voluntary Application by the Business: A taxpayer may choose to apply for cancellation if their business is no longer conducting taxable activities.
- Non-Furnishing of Documents: Registration can be cancelled if the taxpayer does not respond to show cause notices or provide the requested documents.
- Cancellation Due to Non-Compliance: A company’s GST registration may be cancelled if it has broken the GST regulations or incorrectly claimed the Input Tax Credit (ITC) on its GST reports.
Eligibility Criteria for GST Revocation
Before applying for GST revocation, businesses have to meet the following eligibility criteria:
- There must be Cancellation: The first and foremost requirement for revocation is that the GST registration must have been cancelled by the authorities. Without cancellation, you cannot apply for revocation.
- Time Limit: A taxpayer must apply for revocation within 30 days from the date of the GST cancellation order. In certain exceptional cases, the tax authorities may grant an extension of up to 90 days for revocation.
- No Outstanding Liabilities: It is important that the taxpayer clear all outstanding tax dues and liabilities before applying for revocation.
- Compliance with GST Laws: The applicant must comply with all the necessary GST filings, including returns and tax payments.
Documents Required to Apply for GST Revocation
If the authorities have cancelled your GST Registration number, you will need the following documents:
- Fill Out the Application: To request the revocation of your GST cancellation, you must submit a form GST REG-21.
- Letter of Authorization (if needed): If someone else (like an accountant or lawyer) is applying on your behalf, you will need to give them a letter that permits them to do so.
- GST Registration Details: Keep a copy of your GST registration certificate.
- Explain Why You Want Revocation: In the application, you will need to explain why your GST registration was cancelled and why you want it reinstated.
- Cancellation Notice: Provide a copy of the cancellation notice issued by the GST authorities.
- Pending Returns: You will need to show that you have filed all your outstanding GST returns or that you are in compliance with all the necessary rules.
- Any Additional Proof: If there’s anything else that can support your case (for example, proof that your business is still active), include it.
How to Apply for GST Revocation Online in India?
Step 1: Log in to the GST Portal
First, go to the official GST portal at www.gst.gov.in. Enter your registered username and password to log in.
Step 2: Go to the ‘Services’ Tab
Once logged in, find and click on the “Services” tab. Then, select “Registration” from the options and choose “Application for Revocation of Cancellation of Registration.”
Step 3: Fill in the Details
You will proceed to enter your details and explain why you’re requesting the revocation. You may also need to upload any documents to support your request. Fill in the required information and proceed.
Step 4: Submit the Application
After filling in all the details, double-check everything to make sure it’s correct. Once you are sure about the details and document, submit the application using the GST portal. The system will give you an acknowledgement number, which you can use to track your application.
Step 5: GST Authority Review
The tax authorities will review the information you submitted. They will either approve or reject your application based on the details and documents you provided. If the GST officer is unsatisfied with your application for revocation, they will issue a ‘show-cause notice’ in Form GST REG-23 to the taxpayer explaining why he has refused the application. The taxpayer shall be given a chance to explain the reasons why GST registration should not be cancelled. If the application is accepted, the GST registration will be reinstated, and the taxpayer will receive a confirmation.
Timeframe for GST Revocation
As per CGST Notification No. 38 of 2023, a taxpayer must apply for the revocation of GST registration within 30 days from the date of cancellation. If the application is not submitted within this period, the taxpayer may lose the chance to get the registration restored.
In cases where the application is under review, the GST authorities have 30 days to either approve or reject the application. The entire revocation process may take a few weeks to complete.
Consequences of Not Applying for GST Revocation
The penalty of not being registered under GST will still apply if the taxpayer does not request the revocation within the allotted time. Among these repercussions are
- Input Tax Credit (ITC) Loss: The taxpayer will not be eligible to receive input tax credits, which could affect operations and cash flow.
- Inability to Collect GST: The business will not be able to charge GST on its supplies, which may make its products/services less competitive.
- Legal Complications: Continuing business operations without a valid GST registration can lead to legal and financial penalties.
GST Revocation Vs GST Cancellation
While GST cancellation refers to the process where the tax authorities cancel the GST registration due to non-compliance, revocation of GST registration refers to the restoration or reinstatement of a cancelled GST registration.
It is pertinent to note that revocation can only happen after the GST registration is cancelled, and the business must apply to the authorities to get its registration reinstated.
Challenges in GST Revocation
- Non-Compliance with Filing Returns: If the business fails to file GST returns or pay taxes before the cancellation, it can delay or block the revocation process.
- Incorrect or Insufficient Documents: Incomplete or incorrect applications can lead to rejections of your revocation application.
- Misinterpretation of Law: Many businesses misunderstand the GST provisions related to revocation, leading to errors in the process.
GST Revocation After Voluntary Cancellation
If a taxpayer voluntarily cancels their GST registration, the reason can be the closure of business operations or a change of business. The business can still apply for cancellation revocation if it decides to resume operations or meet the registration requirements.
The process and requirements for revocation are the same, though the authorities may require additional evidence to ensure that the taxpayers’ business has resumed its taxable activity.
Why Choose Audit Needs for GST Revocation?
When it comes to GST revocation, Audit Needs is the right partner to help you navigate the process smoothly. Here’s why:
- Expert Guidance: Our team of professionals understands the GST system. We will guide you step-by-step through the revocation process to ensure that you meet all the requirements and avoid any mistakes.
- Timely Filing: We know how important it is to follow deadlines in the GST process. With Audit Needs, you can be sure that your application for revocation will be filed on time, preventing any further issues with your registration.
- Clear Documentation: We will help you gather and organize all the necessary documents so you do not have to worry about missing anything important. Our team ensures that your paperwork is complete and accurate.
- Hassle-Free Experience: Dealing with government processes can be stressful, but with Audit Needs, you can leave the complexities to us. We handle the technicalities so you can focus on running your business.
- Compliance Assurance: We ensure that your application is fully compliant with the GST law, reducing the chances of your revocation request being delayed or rejected.
- Customer Support: If you have any questions during the process, our customer support team is always available to provide answers and offer assistance.
GST Revocation in India
The introduction of the Goods and Services Tax (GST) in India on July 1, 2017, marked a significant turning point in the country’s taxation system. GST aimed to simplify the complex web of indirect taxes that existed prior to its implementation, unifying them into a single tax structure. Businesses are impacted by GST, particularly those in the e-commerce sector, which has grown rapidly in recent years. Businesses, consumers, and legislators all need to comprehend the GST in light of the growing number of digital transactions and economic opportunities.
However, there may be some situations where businesses need to cancel or revoke their GST registration, either voluntarily or due to non-compliance. The revocation of GST registration refers to the process of reinstating the GST registration of a taxpayer that has been cancelled by the GST authorities.
In this guide, we shall understand the GST revocation process, the reasons for cancellation, eligibility criteria, and the steps involved in revoking GST registration. We will also discuss the implications of revocation, the timeline for the process, and the penalties associated with it.
What is GST Revocation?
GST revocation means restoring a GST registration that has been cancelled by the tax authorities. A business that no longer requires its GST registration can voluntarily apply for the cancellation, or the authorities can cancel the registration in cases of non-compliance with the tax laws.
Once the GST registration is cancelled, the taxpayer loses the ability to collect and pay GST, file GST returns, and avail of input tax credits (ITC). Revocation allows the taxpayer to resume these rights by restoring the cancelled GST registration.
Why Do GST Registrations Get Cancelled?
There are several reasons why a GST registration may be cancelled. These include:
- Failure to File Returns: If a taxpayer fails to file GST returns for a continuous period of six months, the authorities may cancel their registration.
- Non-Operational Business: If the business is no longer operational or has been closed without notifying the authorities, the GST registration will be cancelled.
- Failure to Pay Tax: If a registered person fails to pay the GST tax due for an extended period, the authorities may cancel the GST registration.
- Misrepresentation or Fraud: The tax authorities may cancel the GST registration if there is any misrepresentation or fraudulent activity.
- Voluntary Application by the Business: A taxpayer may choose to apply for cancellation if their business is no longer conducting taxable activities.
- Non-Furnishing of Documents: Registration can be cancelled if the taxpayer does not respond to show cause notices or provide the requested documents.
- Cancellation Due to Non-Compliance: A company’s GST registration may be cancelled if it has broken the GST regulations or incorrectly claimed the Input Tax Credit (ITC) on its GST reports.
Eligibility Criteria for GST Revocation
Before applying for GST revocation, businesses have to meet the following eligibility criteria:
- There must be Cancellation: The first and foremost requirement for revocation is that the GST registration must have been cancelled by the authorities. Without cancellation, you cannot apply for revocation.
- Time Limit: A taxpayer must apply for revocation within 30 days from the date of the GST cancellation order. In certain exceptional cases, the tax authorities may grant an extension of up to 90 days for revocation.
- No Outstanding Liabilities: It is important that the taxpayer clear all outstanding tax dues and liabilities before applying for revocation.
- Compliance with GST Laws: The applicant must comply with all the necessary GST filings, including returns and tax payments.
Documents Required to Apply for GST Revocation
If the authorities have cancelled your GST Registration number, you will need the following documents:
- Fill Out the Application: To request the revocation of your GST cancellation, you must submit a form GST REG-21.
- Letter of Authorization (if needed): If someone else (like an accountant or lawyer) is applying on your behalf, you will need to give them a letter that permits them to do so.
- GST Registration Details: Keep a copy of your GST registration certificate.
- Explain Why You Want Revocation: In the application, you will need to explain why your GST registration was cancelled and why you want it reinstated.
- Cancellation Notice: Provide a copy of the cancellation notice issued by the GST authorities.
- Pending Returns: You will need to show that you have filed all your outstanding GST returns or that you are in compliance with all the necessary rules.
- Any Additional Proof: If there’s anything else that can support your case (for example, proof that your business is still active), include it.
How to Apply for GST Revocation Online in India?
Step 1: Log in to the GST Portal
First, go to the official GST portal at www.gst.gov.in. Enter your registered username and password to log in.
Step 2: Go to the ‘Services’ Tab
Once logged in, find and click on the “Services” tab. Then, select “Registration” from the options and choose “Application for Revocation of Cancellation of Registration.”
Step 3: Fill in the Details
You will proceed to enter your details and explain why you’re requesting the revocation. You may also need to upload any documents to support your request. Fill in the required information and proceed.
Step 4: Submit the Application
After filling in all the details, double-check everything to make sure it’s correct. Once you are sure about the details and document, submit the application using the GST portal. The system will give you an acknowledgement number, which you can use to track your application.
Step 5: GST Authority Review
The tax authorities will review the information you submitted. They will either approve or reject your application based on the details and documents you provided. If the GST officer is unsatisfied with your application for revocation, they will issue a ‘show-cause notice’ in Form GST REG-23 to the taxpayer explaining why he has refused the application. The taxpayer shall be given a chance to explain the reasons why GST registration should not be cancelled. If the application is accepted, the GST registration will be reinstated, and the taxpayer will receive a confirmation.
Timeframe for GST Revocation
As per CGST Notification No. 38 of 2023, a taxpayer must apply for the revocation of GST registration within 30 days from the date of cancellation. If the application is not submitted within this period, the taxpayer may lose the chance to get the registration restored.
In cases where the application is under review, the GST authorities have 30 days to either approve or reject the application. The entire revocation process may take a few weeks to complete.
Consequences of Not Applying for GST Revocation
The penalty of not being registered under GST will still apply if the taxpayer does not request the revocation within the allotted time. Among these repercussions are
- Input Tax Credit (ITC) Loss: The taxpayer will not be eligible to receive input tax credits, which could affect operations and cash flow.
- Inability to Collect GST: The business will not be able to charge GST on its supplies, which may make its products/services less competitive.
- Legal Complications: Continuing business operations without a valid GST registration can lead to legal and financial penalties.
GST Revocation Vs GST Cancellation
While GST cancellation refers to the process where the tax authorities cancel the GST registration due to non-compliance, revocation of GST registration refers to the restoration or reinstatement of a cancelled GST registration.
It is pertinent to note that revocation can only happen after the GST registration is cancelled, and the business must apply to the authorities to get its registration reinstated.
Challenges in GST Revocation
- Non-Compliance with Filing Returns: If the business fails to file GST returns or pay taxes before the cancellation, it can delay or block the revocation process.
- Incorrect or Insufficient Documents: Incomplete or incorrect applications can lead to rejections of your revocation application.
- Misinterpretation of Law: Many businesses misunderstand the GST provisions related to revocation, leading to errors in the process.
GST Revocation After Voluntary Cancellation
If a taxpayer voluntarily cancels their GST registration, the reason can be the closure of business operations or a change of business. The business can still apply for cancellation revocation if it decides to resume operations or meet the registration requirements.
The process and requirements for revocation are the same, though the authorities may require additional evidence to ensure that the taxpayers’ business has resumed its taxable activity.
Why Choose Audit Needs for GST Revocation?
When it comes to GST revocation, Audit Needs is the right partner to help you navigate the process smoothly. Here’s why:
- Expert Guidance: Our team of professionals understands the GST system. We will guide you step-by-step through the revocation process to ensure that you meet all the requirements and avoid any mistakes.
- Timely Filing: We know how important it is to follow deadlines in the GST process. With Audit Needs, you can be sure that your application for revocation will be filed on time, preventing any further issues with your registration.
- Clear Documentation: We will help you gather and organize all the necessary documents so you do not have to worry about missing anything important. Our team ensures that your paperwork is complete and accurate.
- Hassle-Free Experience: Dealing with government processes can be stressful, but with Audit Needs, you can leave the complexities to us. We handle the technicalities so you can focus on running your business.
- Compliance Assurance: We ensure that your application is fully compliant with the GST law, reducing the chances of your revocation request being delayed or rejected.
- Customer Support: If you have any questions during the process, our customer support team is always available to provide answers and offer assistance.