Suspension of GST Registration (2023 Guide)

GST laws provide a comprehensive framework for compliance. If the taxpayer fails to comply with the provisions of the GST Act or any rules made thereunder, the GST number is suspended. In this article, we will look at the circumstances for the suspension of GST registration.

What is the meaning of suspended in GST?

Where a registered person applies for cancellation o registration, the registration shall be deemed to be suspended from the date of suspension of the application or the date from which the cancellation is sought, whichever is later, pending the completion of proceeding for cancellation of registration.

What gets you suspended?

GST registration is suspended in the following circumstances

S.No	GST registration is suspended in the following circumstances
1	Taxpayers who have voluntarily opted out of GST registration.
2	Taxpayers who willfully fail to comply with any provision of the CGST Law or Regulations.
3	The composition scheme holder has not filed GST returns for three consecutive quarters.
4	Other taxpayers who have not filed tax returns for six consecutive months.
5	A voluntarily registered taxpayer who has not established a business within six months from the date of GST registration.
6	An individual fraudulently obtains registration under GST.
7	No business from the place of business listed on the GST registration certificate.
8	Issue invoices without actually delivering goods or services.
9	Violate the anti-commercial measures of the CGST Act 2017.
10	Violate Rule 10A (Providing Bank Account Details) of the CGST Regulations.
11	Claiming an ITC in violation of the provisions of Article 16 (ITC Claiming Eligibility).
12	If the total sales reported on Form GSTR-1 is greater than the number of sales reported on GSTR-3B for one or more tax periods.
13	Violate Payment Rule 86B of the CGST Regulations 2017 (Restrictions on Use of Amounts Available in e-credit Ledger)

GST registration is suspended in the following circumstances

What is the suspension process?

Deemed Suspension

If a registrant requests the cancellation of registration under rule 20 of the CGST Regulations, the registration will be considered suspended during the pending period from the date the request is submitted or the date the cancellation is requested, whichever is later pending cancellation of registration under Rule 22 of the CGST Regulations.

Suspension of GST Registration by the proper officer

The appropriate official has reason to believe that a person’s registration may be canceled while the registration cancellation process is ongoing under section 29 of the CGST Act or regulation 21 of the CGST Regulations, and can suspend its registration.

If material discrepancies or anomalies are found when comparing the declarations submitted by registrants, the officer may suspend the registration and issue the GST REG-31 form electronically on the Common Portal or notify the taxpayer of send notifications to the email address to point out inconsistencies.

The taxpayer must explain why the registration should not be canceled within 30 days of receiving this request. Responses must be sent to the Competent Authority via the Common Portal within the specified time limit.

The registration of a particular taxpayer will be suspended and a system-generated request for suspension and notice of cancellation of registration in the form of GST REG-31 stating the reason for the suspension will be sent to the registered email address.

Until FORM REG-31 functionality can be accessed on the website, taxpayers will receive notifications/notices in the form of GST REG-17 on the sharing portal dashboard. SOP allows you to view such notifications after logging in under the View/Notice and Order tab.

The SOP also states that if a taxpayer receives notice of registration suspension or cancellation due to non-filing of returns, they may file all required returns and respond.

What happens if your account is suspended?

A registrant whose registration is suspended may not make taxable supplies during the period of suspension and is not required to file a return under Section 39 of the CGST Act.

A registrant whose registration is suspended may not make taxable supplies during the period of suspension, is not required to file a declaration under Section 39 of the CGST Act, and shall not receive a refund under Section 54 of Suspension of his registration.

What to do if GST number is suspended?

1: After receiving a discrepancy notification

If the taxpayer receives a discrepancy notice, he must respond to the tax authority within one month of receiving the notice. The response should explain all corrective actions and steps taken to address the nonconformity and the reasons for not revoking the registration.

2: After receiving a cancellation notice

One month after receiving the notification, the tax officer should receive a response from the taxpayer in GST Reg 18 form via the official GST portal.

3: Receipt of notification of non-filing of tax return

In the event of notice of suspension or cancellation of registration due to non-filing of returns, the individual may file all returns and submit a response.

How do I revoke my GST suspension?

As a registered taxpayer, you have 30 days to request the reactivation of your GST registration in accordance with the GST Act. However, this is only possible if the licensed GST officer suspends registration. A registration voluntarily suspended cannot be revoked under any circumstances.

How to reactivate GST after suspension?

To reactivate taxpayers must follow the steps listed below.

Login to the GST portal.
Click services > Revocation of Cancellation of GST Registration Enter the reason for the cancellation in the “Reason for cancellation” box.
Click “Choose File” to attach any supporting documentation
Check the verification box.
Enter the authorised signatory’s details.
Submit your application with DSC or EVC.
After the successful submission, the system will generate the ARN.
A confirmation message is sent to your registered mobile phone number and email address.

What is rule 10A of GST?

The government requires taxpayers to provide their bank account details on their website within 45 days of registration approval or the GSTR-3B due date, whichever is earlier.

Breach of Rule 10A – Failure to provide the information required by Rule 10A may result in the termination of an individual’s GST registration.

What is violation of rule 86B of CGST rules?

In cases where the value of taxable supplies, other than exempt and zero-rated supplies, in a month exceeds Rs. 50 lacs, the registered person would not be able to use the money available in his electronic credit ledger to discharge output tax liability above 99% of such tax liability. All other CGST Rules are disregarded in light of this rule.

What is the difference between suspended and Cancelled in GST?

Cancellation of GST registration means permanent closure of the GSTIN under certain circumstances, such as Closure/Transfer/Change of Company Structure, etc.

Suspension of registration under GST means that the GSTIN is temporarily blocked amid the completion of proceedings under the Act or these Regulations.

Frequently Asked Questions(FAQ):-

How do I respond to a GST suspension notice?

The GST REG-18 Form is used when registered taxpayers are required to submit responses to Goods and Services Tax (GST) cancellation/ suspension of notices issued by the Authority.

How long is a permanent suspension?

Permanent Suspension means a Suspension that occurs and continues for 12 consecutive months.

Wrapping Up

Although the government has streamlined the process, it is recommended that you seek professional help for revoking the suspended GST registration. Consulting a GST expert or an accredited certification body can provide possible remedies to deal with the suspension of your GST registration.

Suspension Of GST Registration (2023 Guide)