How is GST registration cancelled, and how can a cancelled registration be revived?

Cancelling on your own (REG-16)

Apply when the business is closed, transferred or merged, the constitution changes (for example, a firm becomes a company), or you are no longer required to register.

• Give the closing stock and the tax on it. You must pay an amount equal to the input tax credit on stock and capital goods held on the cancellation date, or the tax on their value, whichever is higher.
• The officer passes the order in REG-19.
• File the final return GSTR-10 within three months of the cancellation date or order, whichever is later. A late fee applies if you miss it.

Cancellation does not wipe out dues for earlier periods.

Cancellation by the officer

The officer can cancel a registration if, for example:

• returns have not been filed for six months (or, for composition taxpayers, beyond three months after the due date of the annual return);
• business has not started within six months of voluntary registration;
• the registration was obtained by fraud or the person is not found at the address; or
• invoices were issued without supply, or the rules on using credit were broken.

The officer issues a show cause notice in REG-17 and may suspend the registration meanwhile. Reply in REG-18 within 7 working days. Without a satisfactory reply, the officer cancels in REG-19.

Getting it back (REG-21)

1. File all pending returns and pay tax, interest and late fees up to the date of cancellation.
2. Apply in REG-21 within 90 days of the cancellation order. The Joint or Additional Commissioner, or the Commissioner, can extend this by up to 180 days in all on sufficient cause.
3. The officer revokes the cancellation in REG-22, or issues a notice in REG-23 before rejecting it.

If revocation is refused or time has run out, the remedy is an appeal against the cancellation order, within three months.

Why it matters

While your registration is cancelled, your buyers cannot claim input tax credit on your invoices, and e-way bills cannot be generated. Act as soon as a suspension or notice appears on the portal.