Cancellation of registration :
As per section 21 (1) of the Act, Registration may be cancelled either (i) by the tax authority or (ii) by the registered taxable person or (iii) by his legal heirs, in case of death of such person in the following circumstances:
- the business has been discontinued, transferred fully for any reason including death of the proprietor, amalgamated with other legal entity, demerged or otherwise disposed of; or
- change in the constitution of the business; or
- the taxable person (other than the person who applied for registration voluntarily under sub-section (3) of section 19) is no longer liable to be registered under Schedule III.
The manner for such cancellation having regard to the above circumstances will be prescribed in the Rules.
| As per the report of Business Process for GST on GST Registration approved by the EC:
In case of surrender, the system will send an acknowledgment by SMS and e-Mail to the applicant regarding his surrender of registration and he will be deemed to be unregistered from the date of such acknowledgement. There will be a provision in the system to prompt such surrendered registrants to update their address and mobile number at a prescribed periodicity till all dues are cleared/refunds made. |
As per section 21 (2) of the Act, registration of the taxable person may be cancelled by the tax authority from the date, including any anterior date in the following cases:
- registered taxable person has contravened the provisions of the Act /the rules; or
- a taxable person paying tax under section 8 has not furnished returns for three consecutive tax periods; or
- any taxable person, other than paying tax under section 8, has not furnished returns for a continuous period of six months; or
- any person who has taken voluntary registration under sub-section (3) of section 19 has not commenced business within six months from the date of registration.
As per section 21 (3) of the Act, registration of the taxable person may be cancelled by the tax authority with retrospective effect in case where any registration has been obtained by means of fraud, willful misstatement or suppression of facts.
As per section 21 (4) of the Act, before cancelling the registration, such person shall be given a show cause notice (SCN) and a reasonable opportunity of being heard.
As per section 21 (6) of the Act, the cancellation of registration under any of the Act shall be deemed to be a cancellation of registration under both the Acts. As per section 21 (5) of the Act, the cancellation of registration shall not affect the liability of the taxable person to pay tax and other dues under the Act.
As per section 21 (7) of the Act, due to cancellation of registration, taxable person shall pay by way of debit in the electronic credit or cash ledger
(a) In case of inputs:
(1) an amount equivalent to the credit of input tax in respect of:
(i) inputs held in stock and
(ii) inputs contained in semi-finished or finished goods held in stock,
or
(2) the output tax payable on such goods
whichever is higher, calculated in the manner prescribed in the rules.
(b) In case of capital goods:
(1) an amount equal to the input tax credit taken on the said capital goods reduced by the percentage points as may be prescribed in this behalf
or
(2) the tax on the transaction value of such capital goods under sub-section (1) of section 15,
whichever is higher.
Calculation shall be made in accordance with generally accepted accounting principles. The manner shall be prescribed in the Rules.