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A Complete Guide: GST Registration Cancellation And Revocation Under GST Act

If you have a business with a profit turnover of Rs. 20 Lakhs or more then it is mandatory to get registered under the Goods and Services Tax (GST). However, there are instances when businesses need to apply for GST registration cancellation for various reasons like business shut-down or cancellation of registration of GST by tax officers. So, dive into this informative blog that deals with the intrigues of GST orders for cancellation. Your master key to registration cancellation and revocation of GST awaits - Read now!

 GST Registration Cancellation And Revocation Under GST Act: Blog Poster

Are you the owner of a business who is sailing through the complexities of GST registration cancellation? Or, do you want to know under which circumstances GST registration is cancelled by the GST law? 

In this insightful blog, we will delve into GST litigation services, explaining the different reasons businesses deal with GST registration cancellation and reactivation for their business. So, whether you are canceling your GST or it gets canceled by the tax authorities, as one of the renowned chartered accountant firms in Gurgaon we have explained everything in this blog. 

Thus, continue reading, while we break down the process of whose GST registration can be cancelled and ways to reactivate it. 

What Is Meant By GST Registration Cancellation? 

If you have a business with a yearly turnover exceeding a certain threshold limit, then, you need to get your business registered under GST Act as a mandatory process. It is a unified tax litigation services that has streamlined the taxation process by eliminating the process of filing multiple indirect taxes. 

However, GST registration cancellation deals with a notice that a business or a taxpayer is no longer liable to pay tax under the GST Act as the registration is canceled. Under Section 29 of the CGST Act and Rules of 20 and 22, this also means that he/she no longer has to pay or collect GST nor they are required to file GST returns or claim taxation credit. 

Exploring Consequences Of GST Registration Cancellation For Taxpayers

Here are some consequences that you might have to face in case of cancellation of GST registration -

  • Your business will not be able to further collect GST from your customers.
  • You cannot claim an input tax credit under various purchases made.
  • Suppose your business continues after your GST registration cancellation order. Then, it will be treated as a major offense with heavy legal penalties for GST regulations non-compliance. 
  • It can also hamper your business's credibility and reputation among customers and suppliers.
  • You may face disturbances in your business operations due to administrative litigations of revocation of GST registration.

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GST Registration Cancellation

How Can GST Registration Cancelled Under Various Scenarios?

Under Section 29(1) of the GST Act, you can initiate your process to cancel GST registration under these various scenarios of reasons for cancellation of GST:

Disposal Or Discontinuation Of Business For Entities And Taxpayers

Many businesses and taxpayers can seek GST registration cancellation if the business is discontinued under various circumstances, transferred to another person, amalgamation, or the owner's sudden demise, and any other means of business disposal. 

Conversion In Business Constitution 

If there is a change in your business constitution, like converting your partnership business firm into a proprietorship, then, it will cancel the registration of GST resulting in PAN and business warrant cancellation. 

Voluntary Cancellation Of Registration Or Opt-Out

You can cancel the GST registration if you voluntarily wish to close your GST registration under Section 25 (3) or even if your business is not liable for GST department registration under Section 22 or 24.

Read Also: The Insider's Guide To Mastering GST Refunds!

GST Registration Cancellation

Forms And Methods Of GST Registration Cancellation Under These Scenarios:

  • A GST-registered person can seek registration cancellation electronically in the Form GST REG-16. 
  • Fill in documents input and closing stock details providing the date for cancellation of the GST registration application.
  • Enter your liability and payment details on the common GST portal.
  • Thereafter, an investigating tax officer will issue a Form GST REG-19 for GST cancellation within 30 days from the date of application.

What Are The Reasons For Which A Tax Officer Can Issue GST Registration Cancellation?

Under certain circumstances, a GST Tax officer can show-cause notice in Form GST DRC-07 or he can cancel GST registration under the empowerment of Section 29(2), Rule 21 for businesses. Especially, when a taxable individual engages in certain controversies like:

  • If the business is not operational from the registered official address.
  • If a person issues GST bills and invoices under false supply of goods, products, and services. 
  • Violates Section 171 of Anti-Profeeting Act provisions.
  • Availing of Tax Credit by violating Section 16 of the Tax Act.
  • If a taxpayer or business fails to provide returns for a period of continuous six months.
  •  Violating Rule 86B for discharging 99% of tax liability by using ITC Electronic Credit Ledger.

Proactive Measures That GST Officer Can Take For GST Registration Cancellation

  • The GST registration of a registered taxpayer may be suspended under Section 39. If a tax officer finds major differences and anomalies in the Form GSTR-1 of the supplier details.
  • The tax officer can cease registration of a person by showcasing through Form GST REG-17.
  • The taxpayer if wishes to continue with his registration, has to reply to the given notice through Form GST REG-18 within 7 days of the notice being issued. He also has to mention the reasons why his registration should not be cancelled. 
  • If the officer is satisfied with the reply, he can reply to the same form through Form GST REG-20, to drop the suspension.
  • If decides to cancel the registration, the officer has to issue another order under Form GST REG-19 within 30 days.

Reactivation Of GST Cancellation Registration: How To Do It? 

Revocation of GST registration means officially canceling a GST decision made by an officer for application for cancellation. The reactivation of the cancellation of registration means that the taxpayer is yet eligible for valid registration as the decision has been revered by the tax officer and authorities. 

Note: You can apply for GST registration reactivation within 30 days of receiving a cancellation order from a tax officer. 

Now, that you know all about GST registration cancellation and reactivation, let us help you with the process of GST reactivation. 

What Is The Process Of Revocation Of Cancellation Of Registration?

  • You need to prepare and submit your important documents. Such as valid ID proofs, business registration numbers, address proofs, bank statements, and other significant documents.
  • You have to follow the given guidelines and procedures to apply for GST reactivation registration through the online portal. 
  • A tax officer can cancel your GST registration cancellation through order in Form GST 22 after receiving the application within 30 days. 
  • You must issue a show-cause notice under GST REG-23, stating your reason for why your registration should not be canceled. Even after that, if the respective officer decides to dismiss the reactivation application through GST REG-05. Then, you have to respond to the notice within 7 days of receiving the application under GST REG-24. 
  • Henceforth, after receiving the applicant's plea for reactivation of GST registration through GST REG-24. The on-charge officer will decide to revoke the registration cancellation within 30 days of receiving the plea. 

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We share our profound insight on GST registration cancellation and reactivation under various circumstances. You should keep in mind to follow the right processes for trouble-free cancellation and registration under the GST Act. 

You can also contact DSRV India for any tax-related problems to find the best solutions. Our expert team is always ready to guide you through the complexities of GST Tax registration, cancellation, and reactivation.

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