CA Intermediate · Taxation · Registration
Sundaram Textiles, registered in Tamil Nadu, has aggregate turnover of Rs 3 crore. For the past six months it has made no taxable supplies and has not filed returns. The proper officer is considering cancelling its registration. Which is correct as per the CGST provisions on cancellation?
The officer may cancel the registration because returns have not been filed for a continuous period of six months, but only after issuing a show-cause notice and giving an opportunity of being heard. Cancellation is not automatic and does not need the taxpayer's own application.
- AThe officer may cancel only if the registered person himself applies for cancellation
- BThe officer may cancel the registration on grounds such as non-filing of returns for a continuous period of six months, but must give a show-cause notice and an opportunity of being heardCorrect
- CThe registration is automatically cancelled after three months of non-filing
- DThe officer can cancel without notice because the person is a regular taxpayer
Explanation
The proper officer may cancel registration suo motu where a registered person (other than a composition person) has not furnished returns for a continuous period of six months. Cancellation must follow principles of natural justice, so a show-cause notice and hearing are required. It is not automatic and does not depend on the taxpayer's own application.
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