Prior to the changes in the CGST reform act 2018, there is no idea of the suspension of the GST registration beneath GST law. This act introduced the suspension of the enrollment through inserting the proviso to section 29 (2) of the CGST Act, 2017 effective from 01.02.2019. The proviso directed that:
Moreover, it further said that while the due proceedings in context to the refusal of the enrollment, the proper officer might cancel the enrollment for this time, and in this manner, it is mentioned as.
The title of Section 29 was amended from ‘Cancellation of Registration’ to ‘Cancellation or Suspension of Registration’
During a similar period rule, 21A was injected in CGST rules relevant to the suspension of enrollment. The rule 21A held that:
Suspension of Registration Under GST Act
21A. (1) in which the enrolled individual has been applied towards the refusal of the enrollment beneath rule 20 the enrollment will be refused from the submission date if the application or the date from which the cancellation has been looked for whichever is later, due to the finish of the proceedings for the refusal of the enrollment beneath rule 22.
(2) where the proper officer has answers to believe that the enrollment of the individual is entitled to be refused beneath section 29 or beneath rule 21, he might refuse the enrollment of the individual which has been imposed from the date settled by him, due to the completion of the proceedings for the cancellation of enrollment beneath rule 22.
You will be known with the above fact under sub-rule (1), in the event in which the cancellation is implemented through the assessee, the suspension provision is a considering procurement valid till the application date from which the cancellation seeks whoever is later. For instance, the individual makes an application for the refusal of the enrollment on 2/2/2021 however urges cancellation from 1/03/2021, then the GST enrollment will automatically be refused from 1/03/2021, this is appropriate as from the assessee’s view as he is not required to carry on the GST compliances till the cancellation occurs.
In sub-rule (2) in which the cancellation is to be done suo-motto via the Proper Officer then the option is to be rejected is with the proper officer as the word used is may.
A very undesirable shift was implemented wef 22/12/2020 in the mentioned sub-rule (2) that the words post managing the said individual a reasonable opportunity of being heard were omitted. This breaks the justice. The assessee is going to be disallowing GST enrollment and restrict him from asking for tax invoices and GST charges urges to determine in advance like drastic recommended action along with the opportunity to clear out and defend the cases. He will get told the information of the suspension in Form REG-31. This law is only used for bogus invoicing where our understanding of this amendment is to be made.
The postponement is under operation till the order of the cancellation is given or the proceedings for the refusal of the enrollment are discarded.
The other change was imposed to rule 21A through including of the sub-rule 2A which shows that:
2A in which the differentiation of the returns filed through the enrollment of the individual beneath section 39 along with below points:
| (a) | The information of the outward supplies is written in Form GSTR-1 or |
| (b) | The information regarding the inward supplies derived is on the basis of the information of the outward supplies filed by his suppliers in their from GSTR-1 |
Or another analysis is to be done on the recommendations of the department show that there are specific comparisons which shows the contravention of the plan of the act or the rules build, which leads to the refusal of the said individual, his enrollment will be refused and the said individual will be told in Form GST REG-31, on the portal or via communication on the email address which is given during the time of enrollment or as changed from time to time, showing the said differences and seeking him to elaborate, in 30 days so that justification is to be placed that why the enrollment will not be refused.
Some Mandatory Facts are Stated Beneath Sub-rule 2A
The above sub-rule provided that on differentiating the GSTR 3B to GSTR 1 or GSTR 2A it reveals specific comparisons are noticed through the assessee which cause the breach of the enrollment then only the proper officer can refuse the enrollment and not otherwise in my opinion. Inside the law, 2 circumstances have been proved. This analysis has been suggested to the GST dept so until then these are the only 2 circumstances provided beneath sub-rule 2A.
Moreover, the comparisons must be specific, that is to rely on the truth that every case however will not be minor or pretty differences.
The Process is to be Followed for Suo-Motto Suspension of GST Registration
Inside the form GST REG-31 to the assessee, the officer needs to say to the suspension of the enrollment on the portal or on his email address. SCN is provided the REG-31 which is a form to the enrolled assessee urging to refuse the enrollment for the reason which is to be mentioned therein and provided him 30 days duration to furnish the reply.
On the GST portal form, REG-31 has not been activated on the GST portal and CBIC has given a standard operating procedure (SOP) or directions vide circular No 145/01/2021-GST dated 11th February 2021 which is to be accompanied by the plan of the rule 21A(2A). The SOP is reproduced below
As per the dept’s suggestion, the enrollment of the assessee will be refused and the system creates the intimation for the suspension and notices the refusal of enrollment in form GST REG-31, which consists of the reasons of suspension will be sent to these assessees on the enrolled email address. Till form GST REG-31 is present on the portal these notices will be made present to the assessee on their dashboard upon the common portal in form GST REG-17. The assessee should be able to see the notice inside the view notice and order tab after logging.
The assessee to whom the enrollment is refused here is said towards the said person beneath the mentioned plan will be needed to file the reply to the jurisdictional tax officer in 30 days from the date of receipt elaborating the differences, if it is there and will be implemented the information of compliances build or the cause as to why their enrollment must not be refused:
- A. The said individual needs to be answered as to why his enrollment must not be refused by the officer with respect to the notice for refusal of the enrollment sent to them in form GST REG-18 via the portal within 30 days. From the date of receipt.
- B. In case the intimation for refusal and notice for refusal of enrollment is provided on the basis of the non-filing of returns, the said individual might furnish all the left returns and submit the response. Same as usual the other scenario as provided beneath form GST REG-31 might reach the needs and submit the answer.
5.1 After providing the form GST REG-31 through email the list of these assessees will be provided to the concerned nodal officers of CBIC or states. Indeed the system-created notice is to be seen through the jurisdictional officers on their dashboard for the entitled action. On the receipt of a reply from the said individual or the end of the 30 days, a task will be generated in the dashboard of the said proper officer beneath Suo moto denied proceeding.
5.2 The proper officer after the examination of the response has taken from the said individual might pass the order either towards reliving the proceeding for the postponement of the enrollment for form GST REG-20 or for the refusal of the enrollment in form GST REG-19. Lying on the action carried through the proper officer the GSTIN status will be amended to active or canceled suo-moto as the case might.
5.3 Till the time the independent workability for form GST REG-31 has been active, it is to be urged that if the proper officer acknowledged releasing the proceeding anytime post providing of form GST REG-31, then he might suggest to the said individual to file the answer on the portal in form GST REG-18.
5.4 towards the proper officer if he is satisfied with the answer to the said person, he might cancel the suspension through passing the order inside form GST REG-20. After this cancellation, if needed then the proper officer can carry on with the information of verification in the credentials for the insufficient payment taxes. Post validating the proper officer analysis that the enrollment of the said individual is entitled to get revoked, then he can again do the proceeding of the cancellation of the enrollment through furnishing the notices in form GST REG-17.
Determining the Influencing Post to the Suspension Process?
An enrolled individual whose enrollment needs to be postponed in the suspension period-
- He will not provide the tax invoice or impose the GST on the supply as the person shall be not enrolled
- Beneath section 39 the person will not be needed to file the return
- He will not be permitted any refund beneath section 54
