GST Registration: Compulsory Registration, Exemption and Process of GST Registration

Goods and Services Tax (GST) law has become the principal indirect tax law that has subsumed almost all the erstwhile indirect tax laws in India. The law lays down the registration requirements for businesses that satisfy the prescribed conditions, followed by periodical GST filing. Also, certain businesses are exempted from obtaining registration under the GST law. What are the conditions for obtaining GST registration in India? Further, what is the process to apply for GST registration in India? Let’s find out!

Requirement of GST Registration in India

Whether you are required to obtain GST registration or are exempted shall be governed by the following situations:

In the following cases, you are mandatorily required to obtain registration under GST law:

• Crossing the Threshold Limit: In case you are a supplier of goods, you are mandatorily required to obtain GST registration in case your aggregate turnover exceeds Rs. 40 lakhs during the financial year. In the case of a supplier of services, the threshold limit is Rs. 20 lakhs (Rs. 10 lakhs in the case of Manipur, Mizoram, Nagaland and Tripura).
• Interstate Supply of Goods: If you are providing the interstate supply of goods, then you are mandatorily required to obtain GST registration. This is irrespective of whether you cross the threshold limit of Rs. 40 lakhs or not. It should be noted that the criteria of mandatory registration for interstate supply is not applicable in the case of interstate supply of services.
• Casual Taxable Person (CTP) Making Taxable Supply: Casual taxable persons making taxable supplies are mandatorily required to obtain registration under the GST law. However, the threshold limit of Rs. 20 lakhs shall be applicable if the CTP is making interstate supply of notified handicraft goods and notified hand-made goods.
• Reverse Charge Mechanism (RCM) on Inward Supplies: If you have received inward supplies on which RCM is applicable, then you are mandatorily required to obtain GST registration in India. However, this is not applicable in case you are engaged in providing outward supplies on which RCM is applicable.
• Non-Resident Taxable Persons Making Taxable Supplies: If you are an NRTP making taxable supplies, you are mandatorily required to obtain registration under the GST law.
• E-commerce Operators and Suppliers: In the realm of e-commerce, GST registration shall be mandatory for the following persons:
  • Every e-commerce operator who is required to collect TCS under the GST law as per Section 52.
  • Persons supplying goods and/or services through an e-commerce operator who is required to collect TCS under the GST law as per Section 52. However, registration shall not be mandatory in case of supplying notified supplies under section 9(5). Also, the threshold limit of Rs. 20 lakhs (Rs. 10 lakhs in the case of Manipur, Mizoram, Nagaland and Tripura) shall be applicable in case of supply of services through an e-commerce operator.
• Other Conditions: Here are certain other conditions where registration under the GST law shall be mandatory:
  • Persons who are required to deduct TDS under section 51
  • Persons making taxable supply of goods or services or both on behalf of another person as an agent or otherwise
  • Input service distributor
  • Person supplying Online Information and Database Access or Retrieval (OIDAR) services from a place outside India to an unregistered person in India
  • Persons who are required to pay GST under section 9(5)
  • Any other person as may be notified by the government

Exemption from GST Registration

In the following cases, you are exempted from obtaining GST registration even if the above conditions become applicable:

• If you are engaged in supplying goods or services that are not liable to tax or wholly exempt from tax.
• If you are an agriculturist and supplying produce out of the cultivation of land.
• If you are engaged in supplying goods or services or both that are subject to reverse charge mechanism.
• If you are engaged in providing the interstate taxable supply of notified handicraft goods and notified hand-made goods of up to Rs. 20 lakhs.
• If you are a Casual Taxable Person (CTP) engaged in providing interstate taxable supply of notified handicraft goods and notified hand made goods of up to Rs. 20 lakhs.

How to Apply for GST Registration in India?

You can apply for GST registration online by filing an application in Form GST REG-01. Here is the process to apply for GST registration online in India:

1. Visit the GST portal and navigate as follows: Services >> Registration >> New Registration
2. Select your category of taxpayer and enter all the details.
3. Click on ‘Proceed’. An OTP will be sent to your mobile number and email ID.
4. Enter the OTP. A Temporary Reference Number (TRN) will be generated. Save this TRN for all future references.
5. Again, navigate as specified in step-1. This time, select the TRN and enter your TRN number and captcha.
6. Again, an OTP will be sent on your mobile and email. Enter the OTP to open Part-II of Form GST REG-01.
7. Fill in the application form and upload all the relevant documents.
8. After you submit the application, a link for Aadhaar authentication will be sent to your email ID.
9. After you authenticate your Aadhaar, an Application Reference Number (ARN) shall be sent to your mobile and email ID. Save this number for all future references.
10. The concerned officer will scrutinise the application. In case the officer has any queries, a show cause notice (SCN) will be issued. You need to reply to the notice within the specified period.
11. After scrutinising your reply, the officer will decide on the approval or rejection thereof.

After you obtain GST registration, you need to adhere to periodical GST filings. Non compliances can attract significant penalties and eventually suspension of your GST registration.

In a Nutshell

Obtaining GST registration comes with its own set of benefits. Apart from staying compliant with the law, it also reduces your costs as you can claim input tax credit on your purchases and expenses and adjust it against your output tax liability. Not obtaining GST registration despite of being liable to do so can attract unwanted legal consequences. In case you need any assistance in relation to registration and GST filing, feel free to contact the ASC Group.

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