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Tax Laws and Practice · Basics of Goods and Services Tax

GST Compliance Rating under Section 149 of CGST Act

Updated 11 October 2026 · Fact-checked

GST compliance rating is a score the Government may assign to every registered person under section 149 of the CGST Act, 2017. It rests on the person's record of compliance with the Act, uses prescribed parameters, may be updated periodically, is intimated to the person and is placed in the public domain as prescribed.

Understand GST Compliance Rating

Section 149 is a short section. It lets the Government measure how well a registered person follows the GST law and give that record a score. The idea is simple: a taxpayer with a good record becomes visible to buyers, lenders and the department.

Start with who can be rated. The section says every registered person may be assigned a score. A person who is not registered cannot be rated under this section. Note the word may. The section does not force the Government to rate every person. It gives the power.

Next, the basis. The score is based on the person's record of compliance with the provisions of this Act. The Act does not list the parameters. It says the score may be determined on the basis of such parameters as may be prescribed. So the detailed factors are left to the rules. For the exam, say that the parameters are prescribed and do not invent a list.

Finally, publication. The score may be updated at periodic intervals. It may be intimated to the registered person and also placed in the public domain in the prescribed manner. Public display is the key feature. It lets a business check the rating of a supplier before dealing with it.

The section has three sub-sections. Sub-section (1) assigns the score, (2) deals with the parameters, and (3) deals with updating and publication.

Key rules to remember

Who may be rated
Section 149(1): every registered person may be assigned a GST compliance rating score by the Government
Applies to registered persons only. The word 'may' makes it a power, not a duty.
Basis of the score
Record of compliance with the provisions of the CGST Act (section 149(1)); parameters as may be prescribed (section 149(2))
The Act does not list the parameters. They are prescribed.
Updating and publication
Section 149(3): updated at periodic intervals, intimated to the registered person, placed in the public domain in the prescribed manner
Remember the three actions: update, intimate, publish.

How to solve GST Compliance Rating questions

Use this method for any question on GST compliance rating, whether it is a short note or a case-based question.

  1. 1Name the provision first: section 149 of the CGST Act, 2017, headed 'Goods and services tax compliance rating'.
  2. 2State who may be rated: every registered person, assigned by the Government.
  3. 3State the basis: the person's record of compliance with the provisions of the Act.
  4. 4State that the score is determined on such parameters as may be prescribed. Do not list parameters that the Act does not give.
  5. 5State updating and publication: updated at periodic intervals, intimated to the person and placed in the public domain as prescribed.
  6. 6Apply to the facts. Check whether the person is registered and whether the question asks about assignment, basis or publication.
  7. 7End with a clear conclusion in one line.

Quickest way: Three-sub-section recall

When to use it: Use it for short-answer or 'explain section 149' questions when time is tight.

  1. Sub-section (1): who and what. Registered person, score, record of compliance.
  2. Sub-section (2): how. Parameters as prescribed.
  3. Sub-section (3): when and where. Periodic updates, intimation, public domain.
  4. Write one line for each, then add a conclusion.

Common mistakes in GST Compliance Rating

  • Saying every person in India is given a compliance rating.

    Students read 'compliance rating' loosely and forget the word 'registered'.

    Fix: Write that only a registered person may be assigned a score under section 149(1).

  • Writing that the Government must rate every registered person.

    The word 'may' is overlooked.

    Fix: Say the Government may assign the score. The section confers a power.

  • Listing specific parameters such as return filing or tax payment as if they appear in the section.

    Students rely on memory of general discussion rather than the text.

    Fix: Say the basis is the record of compliance and the parameters are as may be prescribed.

  • Forgetting that the score is placed in the public domain.

    Students remember only the assignment of the score.

    Fix: Add that under section 149(3) the score may be updated, intimated to the person and published in the prescribed manner.

  • Quoting the wrong section, such as a registration section, for the rating.

    Compliance and registration are studied together.

    Fix: Link section 149 with the heading 'GST compliance rating'. Registration is covered separately, for example in section 25.

Worked examples

Example 1

Explain the provisions of section 149 of the CGST Act, 2017 relating to GST compliance rating.

Show the solution
  1. Provision: section 149 deals with the goods and services tax compliance rating.
  2. Assignment: under sub-section (1), every registered person may be assigned a compliance rating score by the Government.
  3. Basis: the score depends on the person's record of compliance with the provisions of the Act.
  4. Parameters: under sub-section (2), the score may be determined on such parameters as may be prescribed.
  5. Updating and publication: under sub-section (3), the score may be updated at periodic intervals, intimated to the registered person and placed in the public domain in the prescribed manner.

Answer: Section 149 empowers the Government to assign a compliance rating score to registered persons based on their record of compliance, on prescribed parameters, with periodic updates, intimation to the person and publication in the public domain.

Example 2

Meera Traders Pvt. Ltd. is a registered person in Pune. A supplier, Kumar Enterprises, has not obtained registration. Can the Government assign a GST compliance rating to each of them under section 149? Also, can Meera's score be shown publicly?

Show the solution
  1. Provision: section 149(1) allows a rating score to be assigned to every registered person.
  2. Meera Traders is registered, so the Government may assign it a score based on its record of compliance with the Act.
  3. Kumar Enterprises is not registered, so section 149(1) does not cover it. The section speaks of registered persons only.
  4. Publication: under section 149(3), the score may be updated periodically, intimated to Meera and placed in the public domain in the prescribed manner.
  5. So Meera's score may be shown publicly, but only in the manner prescribed.

Answer: The Government may assign a score to Meera Traders, a registered person, and may publish it in the prescribed manner. It cannot assign one to Kumar Enterprises under section 149 because it is not registered.

Exam tips

  • Write the section number and heading at the start of your answer. ICSI answers reward the provision first.
  • Use the Act's own words: registered person, record of compliance, prescribed parameters, public domain.
  • Do not list parameters or scoring formulas. The Act leaves them to the rules.
  • For case questions, check first whether the person is registered, then apply sub-section (1), (2) or (3) as asked.
  • Keep the answer short. This section is small, so a clear paragraph with a conclusion earns full credit.

Practice questions from Basics of Goods and Services Tax

GST Compliance Rating in other exams

The same ground in other exams, if you are preparing for more than one or want another angle on it.

GST Compliance Rating: frequently asked questions

What is GST compliance rating under section 149?

It is a score the Government may assign to a registered person based on that person's record of compliance with the CGST Act. The score is determined on prescribed parameters. It may be updated and published.

How is GST compliance rating calculated?

Section 149(2) says the score may be determined on such parameters as may be prescribed. The Act does not give a formula. In an exam, say that the parameters are prescribed and avoid inventing a list.

Is the compliance rating made public?

Yes. Under section 149(3), the score may be updated at periodic intervals, intimated to the registered person and placed in the public domain in the prescribed manner.

Does section 149 apply to unregistered persons?

No. Sub-section (1) refers to every registered person. An unregistered person is not covered by this section.