GST Registration Cancellation

Although GST Registration is mandatory for certain suppliers, other suppliers often choose to register under GST voluntarily. A supplier may at any time feel the need of cancellation of the GST registration. This may be due to non-applicability of GST on the supply made or reduced turnover or due to closure of business.


On cancellation of GST Registration, the GST Number or GSTIN of the registered supplier becomes invalid. Once the application for cancellation of registration is approved by the GST department, the supplier is not allowed to collect GST from customers. The supplier is also not required to pay any GST or file any GST Return. Further, he will not be eligible to take any input tax credit.

Voluntary Cancellation of GST Registration

GST registration is commonly cancelled either by the supplier voluntarily (or by legal heir in case of death of supplier) or by the proper officer. The common circumstances/ reasons for cancellation of GST registration through application filed by the supplier voluntarily includes: -

  1. Demerger of business
  2. Discontinuation of business or disposal thereof
  3. Amalgamation of business with other legal entity
  4. Any change in the constitution of the business
  5. The supplier is no longer liable for registration
  6. Complete Transfer of business for any reason including death of the proprietor

Cancellation of GST Registration by the Officer

GST Registration may also be cancelled by the proper officer, after the person concerned is given an opportunity of being heard, where:

  • A registered person has contravened certain provisions of the CGST Act/ CGST Rules, such as –

1. Conducting business from a place other than declared place of business

2. Issuing invoice or bill without supplying of goods or services

3. Failing to pass on the benefit of ITC to the recipient

4. Failing to provide bank account details

  • A person paying tax under the composition scheme has not furnished returns for 3 consecutive tax periods
  • A registered person (other than composition supplier) has not furnished return for a continuous period of 6 months
  • A person who has taken voluntary registration has not commenced business within 6 months from the date of registration
  • Registration has been obtained by means of fraud, willful misstatement or suppression of facts

Payment/ Reversal of ITC on cancellation of registration

The supplier whose registration is cancelled is required to pay an amount equivalent to the input tax in respect of Inputs held in stock in finished goods or semi-finished goods or Capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods.


In case of capital goods or plant and machinery, the input tax credit shall be allowed to be taken only upto the date of validity of GST registration. Any ITC already availed but is attributable to the period after cancellation of registration shall be reversed.

Revocation of Cancellation of GST Registration

If a supplier has applied for cancellation before 14th March 2020, the GST council has provided a facility to apply for revocation of cancellation in case of change of mind.

A registered person, whose registration is cancelled by the proper officer on his own motion, may submit an application for revocation of cancellation of registration in Form GST REG-21 within a period of 30 days from the date of service of the order of cancellation of registration at the common portal.

The respective officer, either revoke the cancellation of the registration or reject the application, after giving an opportunity of being heard.

Yes, if someone discontinued their business activities, the GST registration can be cancelled with the authorities.

GST registration can be cancelled either voluntary –

  1. By the supplier under certain circumstances.
  2. By the legal heir in case of death of the supplier.
  3. By the proper officer where contravention to law takes place.

If the respective officer is satisfied, he can revoke the cancellation of registration by an order in FORM GST REG-22 within 30 days from the date of receipt of the application.

If application has been filed by the supplier for cancellation of registration, the GST officer will look into the application and cancel the registration subject clearance of all dues. Once the registration is cancelled, the applicant will be intimated of the same.

Suo Moto Cancellation of GST Registration means cancellation of registration by GST Officer on its own. There must be a valid reason for initiation of proceeding for Suo moto cancellation as specified under Section 29(2) of the CGST/ SGST Act.

There are certain circumstances where the GST officer may initiate cancellation of registration. Some of the circumstances are: -

  1. A person paying tax under the composition scheme has not furnished returns for 3 consecutive tax periods
  2. A registered person (other than composition supplier) has not furnished return for a continuous period of 6 months
  3. A person who has taken voluntary registration has not commenced business within 6 months from the date of registration

Before application for cancellation, the registered supplier is required to reverse ITC which is already availed but is attributable to the period after cancellation of registration. This is calculated on the inputs held in stock or in semi-finished and finished goods in stock. In case of capital goods, this is calculated on pro-rata basis taking the life of the asset in months.

Revocation of cancellation means the process of reversing the decision of cancelling of the GST Registration. A registered person, whose registration is cancelled by the proper officer on his own motion, may submit an application for revocation of cancellation of registration in Form GST REG-21 within a period of 30 days from the date of service of the order of cancellation of registration at the common portal.

What’s Included

  • Consultation with our Expert
  • Filing application for cancellation
  • Final cancellation
  • ARN Generation

 

Documents Required

  • Supplier’s contact address includes mobile number and Email ID
  • Desired date of cancellation and valid reason of cancellation
  • Details of tax payment, if any
  • Details of latest GST return by the taxpayer
  • Particulars of the value and the tax payable on the stock of inputs, the inputs available in semi-finished goods, inputs available in finished goods, the stock of capital goods/plant and machinery

GST Registration Cancellation


Taxable persons may cancel their own registration or if the Tax Officer issues a Notice regarding it. You can easily cancel a GST registration online with expert assistance through Filecrat.

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