SOP for Suspension of GST Registrations

02March

SOP for Suspension of GST Registrations – Key Highlights

<p style="background-color:rgb(24,24,27);border:0px solid rgb(229,231,235);color:rgb(228,228,231);font-family:'Inter var', 'ui-sans-serif', 'system-ui', sans-serif, 'Apple Color Emoji', 'Segoe UI Emoji', 'Segoe UI Symbol', 'Noto Color Emoji';font-size:14px;font-style:normal;font-weight:400;margin:0px 0px 0.5em;word-spacing:0px;">The Central Board of Indirect Taxes and Customs (CBIC) has introduced a Standard Operating Procedure (SOP) for implementing the suspension of GST registrations under the newly inserted sub-rule (2A) of Rule 21A of the CGST Rules. This provision aims to suspend the registration of businesses involved in activities that may pose a threat to tax revenue.<h4 style="background-color:rgb(24,24,27);border:0px solid rgb(229,231,235);color:rgb(228,228,231);font-family:'Inter var', 'ui-sans-serif', 'system-ui', sans-serif, 'Apple Color Emoji', 'Segoe UI Emoji', 'Segoe UI Symbol', 'Noto Color Emoji';font-size:14px;font-style:normal;line-height:1.5;margin:1.5em 0px 0.5em;word-spacing:0px;">Key Highlights:</h4><ol style="background-color:rgb(24,24,27);border:0px solid rgb(229,231,235);color:rgb(228,228,231);font-family:'Inter var', 'ui-sans-serif', 'system-ui', sans-serif, 'Apple Color Emoji', 'Segoe UI Emoji', 'Segoe UI Symbol', 'Noto Color Emoji';font-size:14px;font-style:normal;font-weight:400;list-style:decimal;margin:0px 0px 1.25em;padding:0px 0px 0px 2.625em;word-spacing:0px;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Suspension of Registration:<ul style="border:0px solid rgb(229,231,235);list-style:disc;margin:0.75em 0px;padding:0px 0px 0px 1.625em;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">The new provision allows for the immediate suspension of GST registration if discrepancies are found between a taxpayer’s filed returns and the details of their outward or inward supplies. These discrepancies could indicate violations of the provisions of the GST Act.</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">The system automatically generates an intimation and notice for cancellation of registration, which is sent to the taxpayer's registered email address.</li></ul></li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Process for Suspension:<ul style="border:0px solid rgb(229,231,235);list-style:disc;margin:0.75em 0px;padding:0px 0px 0px 1.625em;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Upon detecting significant differences in tax returns, a taxpayer’s registration may be suspended.</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">The taxpayer will be notified via email and can access the suspension notice on the GST portal under the “View/Notice and Order” tab.</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">The taxpayer has 30 days from receiving the notice to explain the discrepancies or to submit any required compliances.</li></ul></li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Reply to the Suspension Notice:<ul style="border:0px solid rgb(229,231,235);list-style:disc;margin:0.75em 0px;padding:0px 0px 0px 1.625em;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Taxpayers must respond within 30 days, providing an explanation for the discrepancies or any corrective actions taken.</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">The response can be submitted online in FORM GST REG-18 through the Common Portal.</li></ul></li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Review and Decision by Authorities:<ul style="border:0px solid rgb(229,231,235);list-style:disc;margin:0.75em 0px;padding:0px 0px 0px 1.625em;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">After receiving the taxpayer’s response or after the 30-day period expires, the jurisdictional officer will review the case.</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Based on the review, the officer may either drop the suspension proceeding or initiate the cancellation of the registration.</li></ul></li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">Revocation of Suspension:<ul style="border:0px solid rgb(229,231,235);list-style:disc;margin:0.75em 0px;padding:0px 0px 0px 1.625em;"><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">If the jurisdictional officer is satisfied with the explanation provided, the suspension can be revoked, and the registration status may be updated to "Active."</li><li style="border:0px solid rgb(229,231,235);margin-bottom:0.5em;margin-top:0.5em;padding-left:0.375em;">If the officer finds sufficient grounds, they may proceed with the cancellation of registration.</li></ul></li></ol><p style="background-color:rgb(24,24,27);border:0px solid rgb(229,231,235);color:rgb(228,228,231);font-family:'Inter var', 'ui-sans-serif', 'system-ui', sans-serif, 'Apple Color Emoji', 'Segoe UI Emoji', 'Segoe UI Symbol', 'Noto Color Emoji';font-size:14px;font-style:normal;font-weight:400;margin:0.5em 0px;word-spacing:0px;">This SOP ensures that the suspension of GST registrations is carried out uniformly across all tax jurisdictions and provides a clear procedure for taxpayers to respond to notices.<a href="https://cms.plasament.com/storage/nisha/circular-refund-145-12-2020.pdf">circular_refund_145_12_2020</a>

SOP for Suspension of GST Registrations – Key Highlights

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