PROCESSING OF APPLICATION FOR CANCELLATION OF REGISTRATION SUBMITTED IN FORM GST REG-16.

PROCESSING OF APPLICATION FOR CANCELLATION OF REGISTRATION SUBMITTED IN FORM GST REG-16.
Circular No. 1819057/51 Dated:- 31-10-2018 Uttar Pradesh SGST
GST – States
Enclosed Circular No. 69/43/2018-GST
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Document 1
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Ministry of Finance
Department of Revenue
Central Board of Indirect Taxes and Customs
GST Policy Wing
New Delhi, Dated the October, 2018
To,
The Principal Chief Commissioners/Chief Commissioners/Principal Commissioners/
Commissioners of Central Tax (All)
The Principal Directors General/Directors General (All)
Madam/Sir,
Subject: Processing of Applications for Cancellation of Registration submitted in
FORM GST REG-16 – Reg.
The Board is in receipt of representations seeking clarifications on various issues in
relation to processing of the applications for cancellation of registration filed by taxpayers in
FORM GST REG-16. In order to clarify these issues and to ensure uniformity in the
implementation of the provisions of law across the field formations, the Board, in exercise of
its powers conferred by section 168 (1) of the Central Goods and Services Tax Act, 2017
(hereinafter referred to as the “CGST Act”), hereby clarifies the issues as detailed hereunder:
2.
Sect

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'. It
might be difficult in some cases to exactly identify or pinpoint the day on which such an
event occurs. For instance, a business may be transferred/disposed over a period of time in a
piece meal fashion. In such cases, the 30-day deadline may be liberally interpreted and the
taxpayers' application for cancellation of registration may not be rejected because of the
possible violation of the deadline.
4.
While initiating the application for cancellation of registration in FORM GST REG-
16, the Common portal captures the following information which has to be mandatorily filled
in by the applicant:
a)
Address for future correspondence with mobile number and email address;
b)
Reason for cancellation;
c)
Date from which cancellation is sought;
d)
Details of the value and the input tax/tax payable on the stock of inputs, inputs
contained in semi-finished goods, inputs contained in finished goods, stock of capital
goods/plant and machinery;
e) In case of transfer, mer

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algamation of business, the new entity in which the
applicant proposes to amalgamate or merge has not got registered with the tax authority
before submission of the application for cancellation.
In all cases other than those listed at (a) and (b) above, the application for cancellation of
registration should be immediately accepted by the proper officer and the order for
cancellation should be issued in FORM GST REG-19 with the effective date of cancellation
being the same as the date from which the applicant has sought cancellation in FORM GST
REG-16. In any case the effective date cannot be a date earlier to the date of application for
the same.
6.
In situations referred to in (a) or (b) in para 5 above, the proper officer shall inform
the applicant in writing about the nature of the discrepancy and give a time period of seven
working days to the taxpayer, from the date of receipt of the said letter, to reply. If no reply is
received within the specified period of seven

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ection 51 or section 52) whose registration has been cancelled, to
file a final return in FORM GSTR-10, within three months of the effective date of
cancellation or the date of order of cancellation, whichever is later. The purpose of the final
return is to ensure that the taxpayer discharges any liability that he/she may have incurred
under sub-section (5) of the section 29 of the CGST Act. It may be noted that the last date for
furnishing of FORM GSTR-10 by those taxpayers whose registration has been cancelled on
Page 3 of 5
Circular No. 69/43/2018-GST
or before 30.09.2018 has been extended till 31.12.2018 vide notification No. 58/2018 –
Central Tax dated the 26th October, 2018.
8.
Further, sub-section (5) of section 29 of the CGST Act, read with rule 20 of the
CGST Rules states that the taxpayer seeking cancellation of registration shall have to pay, by
way of debiting either the electronic credit or cash ledger, the input tax contained in the stock
of inputs, semi-fin

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of
final return in FORM GSTR-10. Therefore, the requirement to reverse the balance in the
electronic credit ledger is automatically met. In case it is later determined that the output tax
liability of the taxpayer, as determined under sub-section (5) of section 29 of the CGST Act,
was greater than the amount of input tax credit available, then the difference shall be paid by
him/her in cash. It is reiterated that, as stated in sub-section (3) of section 29 of the CGST
Act, the cancellation of registration does not, in any way, affect the liability of the taxpayer
to pay any dues under the GST law, irrespective of whether such dues have been determined
before or after the date of cancellation.
9. In case the final return in FORM GSTR-10 is not filed within the stipulated date,
then notice in FORM GSTR-3A has to be issued to the taxpayer. If the taxpayer still fails to
file the final return within 15 days of the receipt of notice in FORM GSTR-3A, then an
assessment order in

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lies during the intervening period (i.e. from the
date of registration to the date of application for cancellation of registration) and has
furnished an undertaking to this effect.
11. It is pertinent to mention here that section 29 of the CGST Act has been amended by
the CGST (Amendment) Act, 2018 to provide for “Suspension” of registration. The intent of
the said amendment is to ensure that a taxpayer is freed from the routine compliances,
including filing returns, under GST Act during the pendency of the proceedings related to
cancellation. Although the provisions of CGST (Amendment) Act, 2018 have not yet been
brought into force, it will be prudent for the field formations not to issue notices for non-
filing of return for taxpayers who have already filed an application for cancellation of
registration under section 29 of the CGST Act. However, the requirement of filing a final
return, as under section 45 of the CGST Act, remains unchanged.
12. It may be noted that the

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