GST Update: SOP for implementation of the provision of suspension of GST registrations under newly inserted sub-rule (2A) of Rule 21A

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GST Update: SOP for implementation of the provision of suspension of GST registrations under newly inserted sub-rule (2A) of Rule 21A

Tejasvi

@tejasvi

February 15, 2021

Public Policy

Central Board of Indirect Taxes and Customs (CBIC) has issued Standard Operating Procedures (SOP) vide Circular no 145/01/2021-GST for implementation of provisions relating to suspension of registrations under newly inserted sub-rule (2A) of Rule 21A of CGST Rules, 2017.

The rule provides for power to suspend GST registrations in cases where significant differences or anomalies indicating contravention of the provisions of the Act or the rules due on account of comparison between returns furnished by taxpayer in section 39 (GSTR3B) and outwards supplies in GSTR1 or inwards supplies derived from GSTR-1 furnished by vendors.

In the above cases, the rule provides for intimation in Form REG-31 electronically on the common portal. However, the functionality for Form REG-31 is not developed as of now. Thus the SOP provide that:

Till the time functionality for FORM REG-31 is made available on portal, such notice/intimation will be made available to taxpayer on their dashboard on common portal in FORM GST REG-17. The taxpayers will be able to view the notice in “View/Notice and Order” tab post login.
The taxpayers whose registrations are suspended would be required to reply to jurisdictional officer against the notice for cancellation of registration sent to them in FORM GST REG-18 online through Common Portal within 30 days from the receipt of notice/ intimation.
In case the intimation for suspension and notice for cancellation of registration is issued on ground of non-filing of returns or other scenarios, the said person may file all the due returns or meet the requirements and submit the response.
The system generated notice can be viewed by jurisdictional proper officers on their Dashboard for suitable actions. Proper officer, post examination of the response received from the said person, may pass an order either for dropping the proceedings for suspension/ cancellation of registration in FORM GST REG-20 or for cancellation of registration in FORM GST REG-19. Based on the action taken by the proper officer, the GSTIN status would be changed to “Active” or “Cancelled Suo-moto” as the case maybe.
Till the time independent functionality for FORM GST REG-31 is fully ready, it is advised that if the proper officer considers it appropriate to drop a proceeding anytime after issuance of FORM GST REG-31, he may advise the said person to furnish his reply on the common portal in FORM GST REG-18.
In case the proper officer is prima-facie satisfied with the reply of the said person, he may revoke suspension by passing an order in FORM GST REG-20. Post such revocation, if need be, the proper officer can continue with the detailed verification of the documents and recovery of short payment of tax, if any.
Further, in such cases, after detailed verification or otherwise, if the proper officer finds that the registration of the said person is liable for cancellation, he can again initiate the proceeding of cancellation of registration by issuing notice in FORM GST REG-17.

Trust you will find the update useful.

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Tejasvi