Businesses can apply for revocation of GST registration cancellation by Jun 30 after paying taxes, penalty

The government has allowed businesses, whose GST registration was cancelled for non-filing of returns, to apply for revocation of the cancellation by June 30, after paying due taxes, interest and penalty.

The finance ministry has made amendments in the Central GST act specifying that businesses whose registration have been cancelled on or before December 31, 2022, and who have failed to apply for revocation of cancellation within the specified period can do so by June 30, 2023.

However, the application for revocation shall be filed only after furnishing the returns due up to the effective date of cancellation of registration and after payment of any amount due as tax, in terms of such returns, along with any amount payable towards interest, penalty and late fees.

No further extension of time period for filing application for revocation of cancellation of registration shall be available in such cases, as per the finance ministry notification.

This would act as relief for taxpayers since as per law, Goods and Services Tax (GST) payers have only 30 days time to apply for revocation of registration cancellation order.

The GST council, comprising finance ministers of centre and states, had in its previous meeting in February, recommended that for such GST taxpayers whose registration has been cancelled for non-filing of returns be given amnesty by allowing such persons to file application for revocation within a specified date.

Also, the finance ministry has capped the late fee at Rs 1,000 for the registered persons who fail to furnish the final return in Form GSTR-10 by the due date, provided they furnish the said returns by June 30, 2023.

GSTR-10 is a final return filed by those taxpayers who have decided to cancel its GST registration. As per law, this return has to be filed within three months of opting for cancellation of registration.

Through another notification, the government has also rationalised late fee for delayed filing of annual return in Form GSTR-9 for FY 2022-23 onwards, for MSME tax payers with turnover up to Rs 20 crore.

Those with an aggregate turnover of up to Rs 5 crore in the said financial year would be charged late fee of Rs 50 per day, subject to a maximum of an amount calculated at 0.04 per cent of his turnover.

Registered persons having an aggregate turnover of between Rs 5 crore to Rs 20 crore in the said financial year would be liable to pay late fee of Rs 100 per day, subject to a maximum of an amount calculated at 0.04 per cent of his turnover.

AMRG & Associates Senior Partner Rajat Mohan said the government has unleashed several amnesty schemes for taxpayers nudging them to comply and file pending GST returns by June 30, 2023.

“Fair amnesty schemes have been provided to composition taxpayers, non-filers of final returns, and taxpayers whose GSTN has been cancelled. These amnesty schemes would bring defaulting taxpayers into the mainstream and boost tax collections in the long-run,” Mohan said