Did you have trouble understanding CGST Rule 23? We've got you, so don't worry. This blog post goes into great depth about how to reclaim a suspended GST number.
This article concentrates on the process for activating a suspended GST registration. This post will show you how to reactivate a cancelled GST number. How can you resubmit an application for the cancellation or revocation of your GST registration?
Revocation refers to the formal rejection of a decision or agreement. It suggests that the registration has been reinstated despite the original decision to have it terminated. You will be able to revoke your cancelled GST registration if you file your revocation within the required time frame; if not, you will not be able to do so.
You need to submit a revocation form within 30 days of making a cancellation request. If you revoke your certificate, you will not be able to do so again; this is because you can only do so when the authorities withdraw the GST certificate.
What Does It Mean To Have Your GST Registration Suspended?
The new suspension of GST registration was created by the government. Rule 21A has been added to the 2019 CGST Rules. Because of the enactment of this regulation, a taxpayer who requested the cancellation of their GST registration will no longer be obligated to submit their GST returns in accordance with the requirements during the suspension period.
Recently, the GSTN started alerting taxpayers by text message when their GST filings were inconsistent. In accordance with Notification 94/2020 dated December 22, 2020, Rule 21A of the Central Goods and Services Tax (CGST) Rules has been expanded to incorporate a new sub-rule 2A.
If there are any significant disparities or contradictions between the GSTR-3B and the GSTR-1/2B, the GST registration may be suspended. The GSTIN may also be cancelled if these differences are not resolved.
Furthermore, if the taxpayer requests cancellation, the tax office has the power to suspend the registration until the revocation process is completed, in accordance with the conditions of new Rule 21A, which was approved by Notification 94/2020.
Whose GST Registration Is At Risk Of Being Revoked?
A proper authority can only terminate a registered person’s registration if they have good reason to believe that they should do so. Before beginning the cancellation process specified in Rule 22 of the CGST Rules 2017, the competent authority must give the registered person a fair opportunity to be heard.
While such cancellation processes are ongoing, the appropriate officer has the power to revoke the registration. Therefore, before filling out the GST form, you should be aware of its benefits and drawbacks.
In order to inform the taxpayer of any discrepancies, he might issue a form GST REG-31. Additionally, he will mention that the registration could be cancelled if a legitimate justification for the discrepancies is not given.
In accordance with Rule 21A, he may also suspend the registration as of the date of this letter to the taxpayer (2A). Additionally, the suspension can be lifted if the pertinent authority receives a positive response from the taxpayer.
Taxpayers valued the provision relating to the suspension of GST registration pending cancellation since it relieved them of their obligation to comply with the law until the cancellation procedures were finished.
How To Activate A Suspended GST Number?
Application For Revocation
The registered person must apply for the cancellation of their GST registration in FORM GST REG-21, either directly or through a facilitation centre that the Commissioner has approved.
Revocation Of Cancellation: Online Application Procedure
To revoke or cancel their GST registration online, taxpayers must follow the instructions listed below.
- Taxpayers must first visit the Goods and Services Tax website to start the process of revoking or cancelling their GST registration.
- Click the “Login” button to access the screen that asks for a username and password.
- After entering the correct “Username” and “Password” information, together with the captcha, in the required box, click “login.”
- Simply click the Revocation of Cancellation of GST Registration link under the services category on the homepage.
- When you click the link, the portal takes you to the following page, where you must enter the reason for the cancellation in the “Reason for cancellation” box.
- Click “Choose File” to attach any supporting documentation after that.
- Now select Verification and check the box.
- Select the authorised signatory’s name from the drop-down list under Name of Authorized Signatory.
- You must enter the application’s mailing address in the Place field.
- By selecting the “save” option, you may also save the application form and access it at a later time.
- To submit your work, click the Submit with DSC or Submit with EVC buttons.
- To sign the document, choose either the EVC option or your Digital Signature Certificate (DSC). If you select any of these alternatives, you will get an OTP.
- After successfully submitting the application for cancellation of registration, the system will generate the ARN and show a confirmation message.
- A confirmation message will also be sent to your registered mobile phone number and email address by GST Portal.
- Keep GST records in your native language.
Approval From The Tax Office
- After acquiring the necessary information and being satisfied with it, the relevant authorities may decide to revoke the cancellation of the GST registration.
- Based on the Tax Official’s approval, the system generates an approval order and informs the applicant, the taxpayer’s Primary Authorized Signatory, via email and SMS.
- If the Application for Revocation of Cancelled Registration is accepted, the taxpayer’s GSTIN Status will change from Inactive to Active as of the cancellation’s effective date.
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Rejection By The Tax Office
- The Tax Official issues the rejection order after denying a request to reinstate a cancelled registration.
- The taxpayer will receive information from the Primary Authorized Signatory through SMS and email that the application has been denied, and the GSTIN status on the GST Portal will remain “Inactive.”
- Access to the Rejection Order receipt is available on the taxpayer’s dashboard.
Revocation Of Cancellation: Offline Application Procedure
You can also file the application for revocation of cancellation online by following the instructions below:
- The FORM GST REG-21 application for Revocation or Cancellation of GST Registration can be submitted directly or through a facilitation centre approved by the Commissioner if a registered taxpayer’s registration has been cancelled suo moto by the authorised tax official. This FORM GST REG-21 can be downloaded from the GST portal.
- To file the application through the Common Portal, you have 30 days from the date the cancellation order was issued.
- If the authorised officer determines that there are legitimate grounds as specified by the Act, they may reverse the cancellation of the registration. The official will reply using FORM GST REG-22 within 30 days of receiving the application. The official must document all facts for registration revocation or cancellation in writing.
- After receiving the applicant’s clarification in FORM GST REG-24, the appropriate authority has 30 days to decide.
- The authorized GST officer must provide a notification in FORM GST REG-23 before rejecting a revocation application. The applicant is required to provide a complete response in FORM GST REG-24 within seven working days after receiving the notification. Within 30 days of receiving an adequate response from the applicant, the competent officer must issue the necessary order in FORM GST REG-05.
Consequences of GST Number Suspension
Having your GST number suspended can have significant consequences for your business, impacting your operations, finances, and reputation. Here’s a breakdown of the key repercussions:
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Inability to Conduct Business
- No Taxable Supplies: With your GST registration suspended, you cannot make any taxable supplies of goods or services. This effectively halts your ability to conduct regular business activities like selling products or providing services.
- No Filing of Returns: You cannot file GST returns during the suspension period, leading to the potential accumulation of penalties and interest.
- No Claiming Input Tax Credit: You cannot claim any input tax credit (ITC) on purchases made during the suspension period. This can increase your overall tax liability.
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Financial Implications
- Penalties and Interest: Failure to file returns or pay taxes on time can attract significant penalties and interest charges, adding to your financial burden.
- Loss of Business: Inability to operate and fulfil orders can lead to lost customers and revenue, impacting your business growth.
- Difficulty Obtaining Loans: Banks and financial institutions may be hesitant to provide loans or credit to businesses with a suspended GST registration, hindering your access to working capital.
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Reputational Damage
- Negative Image: Having a suspended GST registration can damage your company’s reputation, raising concerns about its compliance and financial stability.
- Loss of Trust: Customers and business partners may lose trust in your company, leading to a decline in business relations and brand image.
- Difficulties in Future Registrations: Obtaining a new GST registration after suspension can be challenging, involving additional scrutiny and procedures.
Receipt of Notice of Suspension
When your GST registration is suspended, you will receive a notice from the tax authorities specifying the reason for suspension and the duration. It’s crucial to act promptly upon receiving this notice:
- Understand the Reason: Carefully review the notice to understand the specific reason for the suspension and address it accordingly.
- Seek Clarification: If there are any ambiguities in the notice, seek clarification from the tax authorities to avoid misunderstandings.
- Comply with Requirements: Take necessary steps to comply with the requirements outlined in the notice, such as paying outstanding taxes or filing pending returns.
New Rule on Revocation of Cancellation of GST Registration
In a recent development, the government has introduced a new rule allowing businesses to apply for revocation of cancellation of their GST registration under certain conditions. This offers some relief for businesses that may have faced accidental or unintentional cancellations due to technical issues or administrative errors.
It’s important to note that the specific consequences of GST suspension and the process for revocation can vary depending on the individual circumstances and state regulations. Consulting with our Vakilsearch tax advisor or GST expert is highly recommended to navigate the situation effectively and minimize the negative impact on your business.
Conclusion
The GST Forms have many complicated fields, irrespective of the user-friendly layout of the GST system. Therefore, it is strongly advised that you get professional legal assistance for submitting the application, carrying out the necessary steps, filing your taxes, and fulfilling other requirements in the portal.
Our legal experts at Vakilsearch can explain the whole process for GST registration and also help to make the process smoother and more efficient for you.
FAQs on Reactivating a Cancelled GST Number
Can I reactivate my cancelled GST number?
It depends on the reason for cancellation and the timeframe.
Cancellation by Proper Officer: You can generally apply for revocation of cancellation within 30 days of receiving the notice. This involves addressing the reasons for cancellation and fulfilling any compliance requirements.
Suo Moto cancellation: This happens due to non-compliance, like the non-filing of returns. You might need to comply with relevant regulations and pay dues before reapplying for registration after 90 days.
Can you activate a cancelled GST number after 90 days?
For Suo Moto cancellation, re-registration generally requires waiting 90 days. However, you can apply for revocation sooner (within 30 days) if the cancellation resulted from technical issues or misunderstandings.
How do I know if my GST number is active or inactive?
You can check the status of your GST registration on the GST portal by:
Log in with your credentials.
Go to Services > User Services > View Registration Status.
The status will be displayed as Active or Cancelled.
How do I reactivate my old GST number?
The process depends on the cancellation reason:
Revocation of cancellation: Submit Form GST REG-21 within 30 days of cancellation notice, addressing the issues and providing supporting documents.
Re-registration after 90 days: After fulfilling compliance requirements, apply for fresh registration on the GST portal using Form GST REG-01.
How long is a GST number valid for?
A GST registration is valid for life unless specifically cancelled by the taxpayer or the proper officer.
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