QUESTION

My Client is accountant and obtained GSTIN by voluntary registration in July-2017 and gross receipt (Aggregate turnover) as under. F Y 2017-18 Rs. 15,78,047.00 (Taxable 1363056+Rxempted Rs. 214991) F Y 2018-19 Rs. 20,00,997.00 (Taxable Rs. 1746000 +Exempted 25499) F Y 2019-20 Rs. 17,00,532.00 (Taxable 1472468 + Exempted 228064) F Y 2020-21 Rs.9, 66,000.00 ( Taxable 786000 + Exempted 180000) He generally issue his fees invoices yearly basis to his clients ( every 31st March) Now he want to cancel his GSTIN because his gross income (Taxable & Exempted) in current year will not cross 10 lacs. Whether it is possible to cancel GSTIN because he will continuing his profession after cancellation of GSTIN.

ANSWER

FACTS OF THE CASE:

Voluntary Registration was taken by the taxable person in the year 17-18. As the Aggregate turnover is below 10Lakh the taxable person wants to surrender the registration.
(Note: The state of the taxable person is not mentioned in the question. For the purpose of answering your query, we have assumed that the taxable person is located in one of the Special Category States where the registration limit is 10 Lakh.)

LAW APPLICABLE:

Subsection (1) of section 29 CGST specifies that

"(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 opt out of the registration voluntarily made under sub-section (3) of section 25"

INTERPRETATION:

Section 29 of CGST which deals with cancelation of registration allows any taxable person to file an application for the same when they are no longer liable to be registered u/s 22 of the said act or in case they want to opt out of voluntary registration.
In the current case, since the aggregate turnover of the taxable person does not exceed the limit prescribed u/s 22 CGST of 10 Lakh therefore they are no longer liable to registration u/s 22 and are covered u/s 29(1)(c).

CONCLUSION:

The registered person can file an application for cancelling u/s 29(1)(c) and continue their business as an unregistered person. (Reply dt. 26/08/2021)