GST: registration, returns, credit, notices and appeals

A business must register once its aggregate turnover crosses ₹40 lakh for goods or ₹20 lakh for services (lower limits apply in special category states). Some persons must register regardless of turnover, such as casual and non-resident taxpayers, e-commerce operators, and persons liable to pay tax under reverse charge in specified cases. Regular suppliers of goods across state borders also generally need registration.

Small taxpayers may opt for the composition scheme (for goods, up to ₹1.5 crore turnover), which means paying a small percentage of turnover with fewer returns but no input tax credit.

The rate depends on the HSN or SAC classification of what you supply, so check the notified rate for each item. Where a supply spans the change date, the time of supply decides which rate applies. Mixed and composite supplies are taxed differently, so how you bundle goods and services matters.

• Issue a tax invoice with all mandatory particulars within the time allowed.
• E-invoicing through the Invoice Registration Portal is mandatory above the notified turnover limit (₹5 crore at present). An invoice without an IRN can deny your buyer credit.
• An e-way bill is generally needed to move goods worth more than ₹50,000, with exceptions.

• GSTR-1 (outward supplies): generally by the 11th of the next month.
• GSTR-3B (summary return and payment): generally by the 20th of the next month.
• QRMP scheme (turnover up to ₹5 crore): quarterly returns with monthly tax payment; due dates differ.
• Annual return (GSTR-9) and, above a turnover threshold, the reconciliation statement (GSTR-9C).

Late filing attracts a late fee, and late payment of tax carries interest at 18% a year. Check the current due dates on the GST portal, as they are extended from time to time.

You can claim credit only if all of these are met: you hold a valid tax invoice; you have received the goods or services; the supplier has actually paid the tax to the government and filed their return; you have filed your own return; and the credit appears in your GSTR-2B.

• Time limit: by 30 November following the end of the financial year, or the date of filing the annual return, whichever is earlier.
• Blocked credits (Section 17(5)): for example motor vehicles for most uses, food and beverages, club memberships, goods for personal use, and construction of immovable property other than plant and machinery.
• Reversals: credit on exempt supplies, and credit where the supplier is not paid within 180 days.
• Credit wrongly availed and used carries interest at 18% a year, so reconcile before claiming.

Under reverse charge, the buyer, not the supplier, pays GST on notified supplies, such as goods transport services, legal services by advocates, sponsorship, and import of services. Recipients must also track purchases from unregistered suppliers in the categories notified. E-commerce operators collect tax at source (TCS) on supplies made through them, and certain government bodies deduct GST TDS.

Common refunds are for exports (zero-rated supplies, with or without payment of tax under a Letter of Undertaking), inverted duty structures (inputs taxed higher than outputs), and excess balances in the cash ledger. A refund claim must be filed within two years from the relevant date. Mismatches between GSTR-1, GSTR-3B and the shipping or invoice data are the most frequent reasons for rejection.

• Scrutiny of returns: a notice (ASMT-10) asks you to explain differences found in your returns.
• Pre-show-cause intimation and show cause notices: DRC-01A and DRC-01 set out the proposed demand. Paying under protest and filing the payment form can reduce penalty.
• Orders: the officer passes an order after the hearing.

What to do: note the date and reply deadline, check that the notice is within the time limit allowed for that year, reconcile your books with the portal, reply in writing with documents, and attend the personal hearing. Time limits depend on the year and on whether fraud or suppression is alleged, so limitation should be checked first.

• Claiming credit that is not in GSTR-2B, or blocked credit.
• Applying an old rate after the 22 September 2025 changes, or classifying an item wrongly.
• Missing reverse charge liability on notified services.
• Mismatch between GSTR-1 and GSTR-3B.
• Ignoring a notice because the amount seems small.
• Not reversing credit on exempt or personal-use supplies.