GST--Cancellation of Registration
Show Cause Notice for Cancellation of Registration Issued in Form GST REG-31--Validity of
CA. Satyadev Purohit
The learned author aims at making an analytical study of the issue as to whether cancellation registration is sustainable where the show cause notice was not issued in the prescribed form. The related issue is being discussed in the light of relevant statutory provisions and a recent High Court decision in the case of Dominic David v. State Tax Officer (2023) 70 GSTL 52 (Ker-HC).
The provisions relating to cancellation of registration are made under section 29 of the Central Goods and Services Tax Act, 2017 (in short "the CGST Act"). As per sub-section (1) of section 29 of the CGST Act, the proper officer may, either on his own motion or on an application filed by the registered person or by his legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where, -
(a) 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
(b) there is any change in the constitution of the business; or
(c) the taxable person is no longer liable to be registered under section 22 or section 24 or intends to opt out of the registration voluntarily made under sub-section (3) of section 25.
Sub-section (2) of section 20 of the CGST Act empowers the proper officer to cancellt eh registration of a person, 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 the return for a financial year beyond three months from the due date of furnishing the said return; or
(c) any registered person, other than a person specified in clause (b), has not furnished returns for such continuous tax period as may be prescribed; 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.
The contraventions of the nature specified under clause (a) of sub-section (2) of section 20 are prescribed under rule 21 of the Central Goods and Services Tax Rules, 2017 (in short "the CGST Rules"), according to which the registration granted to a person is liable to be cancelled, if the said person,-
(a) does not conduct any business from the declared place of business; or
(b) issues invoice or bill without supply of goods or services or both in violation of the provisions of this Act, or the rules made thereunder; or
(c) violates the provisions of section 171 of the Act or the rules made thereunder; or