CANCELLATION OF GST REGISTRATION, Goods and Services Tax - GST

[DR.MARIAPPAN GOVINDARAJAN]

When the GST registration is cancelled what would be the impact on business. Whether they can levy GST on the supplies made by the business entity? If GST is levied registration is compulsory. Whether the business entity may be punished for levy of GST in the absence of registration certificate? There is no clear provision in this regard in the Act as well as in the Rules made thereunder.

Kindly throw light on this issue.

Posts / Replies

[VENU K]

Sec 76 can be invoked and such tax collected and not paid to Government can be recovered with interest and a penalty equivalent to the amount specified in the notice can be collected. Sub Sections 1, 2 and 4. Further Penalty Section 122 (iv) specifically could be imposed in such case in my opinion.

Further Sec 76 does not specify any time limit for issue of notice which means such amounts could be recovered any time by giving a notice and making an assessment within one year of date of service of such notice. Please note that Sec 76 overrides all laws as per the non obstante clause.

[DR.MARIAPPAN GOVINDARAJAN]

Section 76 can be invoked when a business entity collects tax but not remit the same to the Department.  My question is as to whether the business entity can collect GST and issue invoice after cancellation of registration,  in the absence of registration.  

[VENU K]

Section 32 Prohibition of Unauthorized Collection of Tax

Sec 32(1) Says that a person who is not a registered person shall not collect in respect of a supply of goods or services or both any amount by way of tax under this Act.

If tax is collected in violation of this section penalty can be imposed. Sec 76 can be invoked for recovery of such unauthorised collection of tax..

Further only a registered person supplying taxable goods can issue a tax invoice as per Sec 31