Circular No. 95/14/2019 – GST: Seeks to clarify verification for grant of new registration.

Important Keyword: F. No. CBEC-20/16/04/2018 – GST, Circular No. 95/14/2019-GST, Section 29(2) CGST Act 2017, Rule 21 CGST Rules 2017, Section 30 CGST Act, Rule 23 CGST Rules, Section 25(2) CGST, Section 168 (1) CGST Act, Section 25(10) CGST Act, Rule 9 CGST Rules, Section 29(2)(b)(c) CGST Act, Rule 9(4) of CGST Rules.

F. No. CBEC-20/16/04/2018 – GST
Government of India
Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
*****

New Delhi, Dated the 28^th March, 2019

Circular No. 95/14/2019 – GST

To,

The Principal Chief Commissioners / Chief Commissioners / Principal Commissioners / Commissioners of Central Tax (All)
The Principal Director Generals / Director Generals (All) Madam/Sir,

Subject: Verification of applications for grant of new registration – Reg.

Recently, a large number of registrations have been cancelled by the proper officer under the provisions of sub-section (2) of section 29 of the Central Goods and Services Act, 2017 (hereinafter referred to as „CGST Act‟) read with rule 21 of the Central Goods and Services Rules, 2017 (hereinafter referred to as „CGST Rules‟) on account of non- compliance of the said statutory provisions. In this regard, instances have come to notice that such persons, who continue to carry on business and therefore are required to have registration under Goods and Services Tax, are not applying for revocation of cancellation of registration as specified in section 30 of the Central Goods and Services Tax Act read with rule 23 of the Central Goods and Services Tax Rules. Instead, such persons are applying for fresh registration. Such new applications might have been made as such person may not have furnished requisite returns and not paid tax for the tax periods covered under the old/cancelled registration. Further, such persons would be required to pay all liabilities due from them for the relevant period in case they apply for revocation of cancellation of registration. Hence, to avoid payment of the tax liabilities, such persons may be using the route of applying for fresh registration. It is pertinent to mention that as per the provisions contained in proviso to sub-section (2) of section 25 of the Central Goods and Services Tax Act, a person may take separate registration on same PAN in the same State.

2. In order to ensure uniformity in the implementation of the provisions of law across the field formations, the Board, in exercise of its powers conferred by section 168 (1) of the Central Goods and Services Tax Act, hereby issues the following instructions.

3. Sub-section (10) of section 25 of the Central Goods and Services Tax Act read with rule 9 of the Central Goods and Services Tax Rules provide for rejection of application for registration if the information or documents submitted by the applicant are found to be deficient. It is possible that the applicant may suppress some material information in relation to earlier registration. Some of the information that may be concealed in the application for registration in FORM GST REG -01 are S. No. 7 „Date of Commencement of Business‟, S. No. 8 “Date on which liability to register arises‟, S. No. 14 “Reason to obtain registration‟ etc. Such persons may also not furnish the details of earlier registrations, if any, obtained under Goods and Services Tax on the same PAN.

4. It is hereby instructed that the proper officer may exercise due caution while processing the application for registration submitted by the taxpayers, where the taxpayer is seeking another registration within the State although he has an existing registration within the said State, or his earlier registration has been cancelled. It is clarified that not applying for revocation of cancellation of registration along with the continuance of the conditions specified in clauses (b) and (c) of sub-section (2) of section 29 of the Central Goods and Services Tax Act shall be deemed to be a “deficiency” within the meaning of sub-rule (2) of rule 9 of the Central Goods and Services Tax Rules. The proper officer may compare the information pertaining to earlier registrations with the information contained in the present application, the grounds on which the earlier registration(s) were cancelled and the current status of the statutory violations for which the earlier registration(s) were cancelled. The data may be verified on common portal by fetching the details of registration taken on the PAN mentioned in the new application vis-a-vis cancellation of registration obtained on same PAN. The information regarding the status of other registrations granted on the same PAN is displayed on the common portal to both the applicant and the proper officer. Further, if required, information submitted by applicant in S. No. 21 of FORM GST REG-01 regarding details of proprietor, all partner/Karta/Managing Directors and whole time Director/Members of Managing Committee of Associations/Board of Trustees etc. may be analyzed vis-à-vis any cancelled registration having same details.

5. While considering the application for registration, the proper officer shall ascertain if the earlier registration was cancelled on account of violation of the provisions of clauses (b) and (c) of sub-section (2) of section 29 of the Central Goods and Services Tax Act and whether the applicant has applied for revocation of cancellation of registration. If proper officer finds that application for revocation of cancellation of registration has not been filed and the conditions specified in clauses (b) and (c) of sub-section (2) of section 29 of the Central Goods and Services Tax Act are still continuing, then, the same may be considered as a ground for rejection of application for registration in terms of sub-rule (2) read with sub-rule (4) of rule 9 of Central Goods and Services Tax Rules. Therefore, it is advised that where the applicant fails to furnish sufficient convincing justification or the proper officer is not satisfied with the clarification, information or documents furnished, then, his application for fresh registration may be considered for rejection.

6. It is requested that suitable trade notices may be issued to publicize the contents of these instructions.

7. Difficulty, if any, in the implementation of these instructions may be brought to the notice of the Board. Hindi version will follow.

(Upender Gupta)
Principal Commissioner (GST)

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