Under GST, notices serve as a means for GST Authorities to communicate with taxpayers. These notices are specifically sent to remind or alert taxpayers about any observed defaults, particularly related to non-compliance with GST laws and provisions. It is crucial for taxpayers to Reply to Show Cause Notice for Cancellation of GST Registration within the specified time frame. Failing to do so can lead to legal consequences.
This article discusses the process of Reply to Show Cause Notice for Cancellation of GST Registration issued by the proper officer and the reasons that may lead to such situations. In order to submit Reply to Show Cause Notice for Cancellation of GST Registration, registered taxpayers can use Form GST REG-18, which is submitted online through the GST Portal.
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Reasons for Receiving Notice in Form GST REG-17
If the authorized officer has valid grounds to suspect that a person’s GST registration might be cancelled under section 29, they will issue a notice (Form GST REG-17). This notice requires the individual to explain within seven working days why their registration should not be cancelled.
Cancellation proceedings can be initiated under various circumstances, including:
- A taxpayer under the composition scheme not filing returns for three consecutive years.
- A taxpayer, other than a composition taxpayer, not filing returns for six continuous periods.
- An individual with voluntary GST registration not starting a business within six months.
- Violation of GST Act or Rules by a taxpayer.
- Fraudulent or falsified methods used for GST registration.
- Taxpayer availing input tax credit in violation of section 16 or engaging in tax evasion.
- Failure to pay tax, interest, or penalty to the GST department within three months.
- Closure of the taxpayer’s business.
- Death of a sole proprietor.
- Change in the taxpayer’s constitution leading to a PAN change.
- The person is no longer required to be registered under GST or to collect or pay tax.
- Transfer of business due to merger or amalgamation.
How to Submit GST Reg 17 Notice Reply
When a taxpayer receives a notice for the cancellation of their GST registration, they need to submit GST Reg 17 Notice Reply in Form GST REG-18. It is crucial for taxpayers to respond within seven days of receiving the notice, providing an explanation or valid reasons to justify retaining their registration and preventing cancellation.
Reply to Show Cause Notice for Cancellation of GST Registration should include the following information:
- Reference number of the notice received in Form GST REG-17.
- Date when the notice in Form GST REG-17 was issued.
- GST registration number of the individual or business.
- Legal name and trade name (if applicable) of the business.
- Detailed reply to the notice along with any supporting documents.
- Verification box to confirm the accuracy of the information provided.
Filing GST Registration Cancellation Notice Reply in Form GST REG-18
As per the regulations, when a taxpayer receives a notice in Form GST REG-17 and disagrees with it, they must file a GST Registration Cancellation Notice Reply online using Form GST REG-18.
Here are the steps to follow:
- Visit the GST Portal at www.gst.gov.in and log in to your taxpayer account using your username and password.
- Navigate to Services > Registration > Application for Filing Clarifications.
- Enter the Reference Number of the Notice or Application Reference Number (ARN) available.
- Click the ‘Search’ button to display Form GST REG-18 on the page.
- Provide your reply on the page, including any relevant supporting documents.
- Click ‘Submit’ when finished.
If the officer finds GST Reg 17 Notice Reply acceptable, they will drop the proceedings and issue an order in Form GST REG–20. However, if the registration is no longer applicable or is liable for cancellation, the officer will issue an order in Form GST REG-19 within thirty days from the application date or the reply date. This order will cancel the registration, specifying the effective date, and instruct the taxable person to pay tax, interest, or penalties, including amounts under sub-section (5) of section 29.
Revocation of Cancellation of Registration:
(a) If the proper officer cancels a registration without the registered person’s request, the individual can apply for revocation using FORM GST REG-21. This application must be submitted to the proper officer within ninety days from the date of receiving the cancellation order, either directly through the common portal or via a Facilitation Centre authorized by the Commissioner. The Commissioner or an authorized officer may extend this period for up to one hundred and eighty days upon showing sufficient cause in writing.
(b) If, upon reviewing the application, the proper officer is satisfied that there are valid reasons for revoking the cancellation, they will issue an order in FORM GST REG-22 within thirty days and communicate it to the applicant.
(c) If the proper officer is not convinced upon examining the revocation application, they will issue a notice in FORM GST REG–23, asking the applicant to explain why the revocation application should not be rejected. The applicant must respond within seven working days using FORM GST REG-24.
(d) After receiving the applicant’s response in FORM GST REG-24, the proper officer will decide within 30 days. If the information provided is satisfactory, the officer will proceed with revoking the cancellation as per point (c). If not, the applicant will be given a mandatory opportunity to be heard. After considering the reasons and recording them in writing, the proper officer may reject the revocation application using FORM GST REG-05 and communicate this decision to the applicant.
(e) The individual whose registration cancellation has been revoked must submit all pending returns for the period starting from the date of the cancellation order until the date of the revocation order within thirty days from the date of the revocation order.