Non-Filing of Tax Returns Results in Cancellation of GST Registration for 163K Business Entities

The Goods and Service Tax (GST) registration of about 163,000 business entities has been canceled by the government. This has been cancelled for the businesses that have not filled the monthly tax returns (GSTR-3B) for the last six months or more.

Alongside, the department would also persuade 25,000 taxpayers, who have not filed the tax return for October that has been due by November 24, to comply with tax return deadlines.

“All these business entities, who had not filed their GSTR-3B returns for more than six months, were first issued the cancellation notices, and then their registrations were canceled as per standard operating procedure,” states one of the officials.

The push for better compliance comes on the heels of the tax department’s nationwide drive against fake invoice scams. It is doubted that fraudsters often register firms under GST but remain mostly lethargic on compliance while using the status to claim an invalid input tax credit (ITC).

The Tax officers have been directed to follow up personally with these defaulting taxpayers so that their GSTR-3B returns due get filled month are filed by November 30. As per the sources, in the Ahmedabad zone, 11,048 GST registrations have been canceled.

In the Chennai zone, 19,586 suo motu cancellations have been done so far in respect of GST taxpayers who have failed to file returns for more than six months. The officials said that the tax authority is also scanning newly registered entities that have not provided correct details at the time of registration. Out of 720 deemed registrations granted between August 21 and November 16 this year, where Aadhaar authentication was not done, 55 deemed registrations have been identified for the discrepancy and the process of cancellation was initiated in these cases.