Amended and updated notes on section 29 of CGST Act, 2017. Detail discussion on provisions and rules related to cancellation or suspension of registration.
Chapter VI (Sections 22–30) of the Central Goods and Services Tax Act, 2017 deals with the provisions related to registration. Section 29 of CGST 2017 provides for cancellation or suspension of registration.
Recently, we have discussed in detail section 28 (Amendment of registration) of CGST Act 2017. Today, we learn the provisions of section 29 of Central GST Act 2017 as amended by the Finance Act 2022.
Section 29 of the Central Goods and Services Tax Act, 2017 has been notified by the Ministry of Finance vide Notification No. 1/2017-Central Tax, G.S.R. 605(E), dated 19.06.2017. This notification was come into force from 22nd June, 2017 i.e. the commencement date of section 29 is 22-6-2017.
| Name of Act | The Central Goods and Services Tax Act 2017 |
|---|---|
| Enacted by | Parliament of India |
| Administered by | Central Board of Indirect Taxes & Customs |
| Governing body | GST Council |
| Number of Chapters | 21 |
| Number of Sections | 174 |
| You are reading: | |
| Chapter No. | VI |
| Chapter Name | Registration |
| Section No. | 29 |
| Section Name | Cancellation or suspension of registration |
| Updated 2024 Edition | GST Law Book PDF |
Relevant Rules and Forms for GST Section 29:
- Rule 20: Application for cancellation of registration
- FORM GST REG-16: Application for Cancellation of Registration
- Rule 21: Registration to be cancelled in certain cases
- Rule 21A: Suspension of registration
- FORM GST REG-31: Intimation for suspension and notice for cancellation of registration
- Rule 22: Cancellation of registration
- FORM GST REG-17: Show Cause Notice for Cancellation of Registration
- FORM GST REG-18: Reply to the Show Cause Notice issued for cancellation for registration
- FORM GST REG-19: Order for Cancellation of Registration
- FORM GST REG-20: Order for dropping the proceedings for cancellation of registration
- Rule 44: Manner of reversal of credit under special circumstances
- FORM GSTR-10: Final Return
Section 29 of Central GST – Cancellation or suspension of registration1
Section 29 of CGST Act 2017 shall come into force on 22.06.2017 vide Notification No. 1/2017-Central Tax, G.S.R. 605(E), dated 19.06.2017.
Section 29(1) of CGST Act
Section 29(1): The proper officer may, either on his own motion or on an application filed by the registered person or by his legal heirs, in case of death of such person, cancel the registration, in such manner and within such period as may be prescribed, having regard to the circumstances where, ––
- (a) the business has been discontinued, transferred fully for any reason including death of the proprietor, amalgamated with other legal entity, demerged or otherwise disposed of; or
- (b) there is any change in the constitution of the business; or
- (c) the taxable person is no longer liable to be registered under section 22 or section 24 or intends to optout of the registration voluntarily made under sub-section (3) of section 25: [Clause (c) of section 29(1) was substituted w.e.f. 1st January, 2021 by the Finance Act 2020 vide Notification No. 92/2020-Central Tax, S.O. 4643(E), dated 22.12.2020.]
Provided that during pendency of the proceedings relating to cancellation of registration filed by the registered person, the registration may be suspended for such period and in such manner as may be prescribed.
Section 29(2) of CGST Act
Section 29(2): The proper officer may cancel the registration of a person from such date, including any retrospective date, as he may deem fit, where, ––
- (a) a registered person has contravened such provisions of the Act or the rules made thereunder as may be prescribed; or
- (b) a person paying tax under section 10 has not furnished [the return for a financial year beyond three months from the due date of furnishing the said return]; or [Amendments (Substituted) of Section 29(2)(b) are made by the Finance Act, 2022]
- (c) any registered person, other than a person specified in clause (b), has not furnished returns for [such continuous tax period as may be prescribed]; or [Amendments (Substituted) of Section 29(2)(c) are made by the Finance Act, 2022]
- (d) any person who has taken voluntary registration under sub-section (3) of section 25 has not commenced business within six months from the date of registration; or
- (e) registration has been obtained by means of fraud, wilful misstatement or suppression of facts:
Provided that the proper officer shall not cancel the registration without giving the person an opportunity of being heard.
Provided further that during pendency of the proceedings relating to cancellation of registration, the proper officer may suspend the registration for such period and in such manner as may be prescribed.
Section 29(3) of CGST Act
Section 29(3): The cancellation of registration under this section shall not affect the liability of the person to pay tax and other dues under this Act or to discharge any obligation under this Act or the rules made thereunder for any period prior to the date of cancellation whether or not such tax and other dues are determined before or after the date of cancellation.
Section 29(4) of CGST Act
Section 29(4): The cancellation of registration under the State Goods and Services Tax Act or the Union Territory Goods and Services Tax Act, as the case may be, shall be deemed to be a cancellation of registration under this Act.
Section 29(5) of CGST Act
Section 29(5): Every registered person whose registration is cancelled shall pay an amount, by way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock 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, whichever is higher, calculated in such manner as may be prescribed:
Provided that in case of capital goods or plant and machinery, the taxable person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery, reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery under section 15, whichever is higher.
Section 29(6) of CGST Act
Section 29(6): The amount payable under sub-section (5) shall be calculated in such manner as may be prescribed.
- Section 29 of CGST Act 2017 shall come into force on 22.06.2017 vide Notification No. 1/2017-Central Tax, G.S.R. 605(E), dated 19.06.2017. ↩︎