GST Registration will be Cancelled for Non-Filers

Cancellation of GST Registration:

When the taxpayer is not able to pay or collect GST and is no more registered under the GST, this is called cancellation of GST Registration. Usually, a taxation officer or taxation department cancels the Goods and Services Tax number of the business or the taxpayer due their inability to file the returns. GST Return Filing helps the taxation authorities in estimating the tax liabilities and the amount of taxes that have been paid. Therefore, the Goods and Services Tax administration has decided to take actions in form of cancellation of GST Registration against the persons who have not filed returns in GSTR-3B at least six or more months.  

Consequences of Cancellation of GST Registration:

Cancellation of GST Registration can have major consequences for the taxpayers. These are as follows-

  • The taxpayer will not be able to pay any GST.
  • GST registration is mandatory for certain type of business. and if it is cancelled but the business is still commencing then it is illegal under GST and can attract hefty penalties and fine.

Conditions for Cancellation of GST Registration:

The conditions for cancellation of GST Registration is prescribed and provided in Section 29 of the Central Goods and Services (CGST) Act, 2017. When these conditions are fulfilled by any taxpayer or business entity it calls and invites for action. These conditions include-

  • Contravening the provisions mandated in the act.
  • Any assesses under the composition scheme that have not furnished or filed returns for three consecutive years or taxation period.
  • If a non-composition assesses have not filed the returns for six consecutive months in a particular taxation year.
  • If the business has not been commenced within six months of the voluntary GST Registration.
  • If Registration under GST has been obtained through willful misstatements, by suppressing the facts or by any fraudulent means.

The CGST Act, 2017 clearly states that if any of the above-mentioned condition is met then the registration is likely to be cancelled without giving any opportunity to be heard to the taxpayer or business entity. As per the GST Laws, a person having GST Registration has to file returns monthly if he/ she is a normal supplier and quarterly in case the supplier has opted the composition scheme. A monthly return showing the details of distributed credit in a particular month has to be filed by the Input Service Distributor (ISD). Any person required to collect taxes under Tax Collected at Sources (TCS) or is required to deduct taxes under the Tax Deducted at Sources (TDS) has to file the monthly returns specifying the details of the tax amount collected or deducted and other necessary details. Also, the Non-Resident taxable person is also liable to file for the NRI Tax Return for the undertaken activity for certain time period. The taxation department has made it very clear that the liability of a person to pay levied taxes and amount dues will not be affected by the cancellation of GST Registration. They are likely to pay the taxes as per the directions of the department.

Author: Anil Agrawal
EZYBIZ India Consulting LLP, New Delhi. The firm is business and tax consultancy firm providing consultancy in Taxation, Regulatory, Transfer pricing, Valuation, Corporate funding and Business set up matters. He may be reached at 9899217778 or