Cancellation of GST Registration: Understanding Suo Moto Cancellation Procedures and Consequences
Cancellation of GST Registration: Understanding Suo Moto Cancellation Procedures and Consequences

Cancellation of GST registration ‘suo moto’ signifies that the tax authority decided to cancel the registration independently. According to Section 29(2) of the CGST Act, the tax office needs a good reason to begin cancellation procedures.

Needed For Automatic GST Cancellation

  •   If any of the following is true, the tax officer may cancel the transaction suo moto
  •   If taxpayers register a business based on a lie, omission, or misrepresentation they will face penalties
  •   The taxpayer did not apply for GST Registration Process within 90 days of the appointed date or such later date as may be prescribed
  •   For six months, the taxpayer has not submitted tax returns. In the case of a composition taxpayer, the required period for submitting returns is reduced to three months
  •   The taxpayer has engaged in tax evasion by supplying goods or services without issuing an invoice, as prohibited by the CGST Act
  •   It has come to our attention that the taxpayer has issued an invoice without providing the products or services for which the invoice is being given to claim an input tax credit or a tax refund falsely.
  •   If the collected taxes aren’t deposited with the Treasury within 90 days.
  •   The taxpayer has a 90-day tax payment, interest, or penalty payment due to the government that has not been paid.
  •   Misconduct during any proceeding under the GST Act.
  •   It has come to light that the person in question is either exempt from or no longer subject to GST Tax Calculator deduction and collection obligations.
  •   Upon the death of the sole proprietor, if the business’s governing documents provide for a sole proprietorship; upon the amalgamation, transfer, merger, demerger, or similar event; and in the event of any other similar event.
  •   If the Constitution is amended in a way that affects PAN,
  •   If the company decides to shut down and stop operating,

The Correct Suo Moto Canceling Procedure

  •  GST legislation requires the tax officer to provide the taxpayer a show-cause notice, giving the taxpayer a chance to explain his side of the story. The taxpayer must provide reasons why the registration should not be revoked in response to the show-cause notice. The taxpayer must react to this notice within seven business days.
  •  If the tax officer is happy with his response, he may abandon the cancellation proceedings he has launched and notify the taxpayer of his decision through SMS or email.
  •  If the tax office does not hear back from the taxpayer within seven business days, or if the taxpayer’s response is unsatisfactory, the registration will be canceled.

Ability to get one’s voice heard

The cancellation of registration must be preceded by the issuance of a Show Cause Notice (SCN) and the taxpayer’s reasonable opportunity to respond to the SCN. The Tax Official must therefore serve the taxpayer with an SCN before beginning Suo Moto cancellation proceedings, requesting an explanation as to why the taxpayer’s registration should not be canceled.

What Will Happen If Suo Moto Cancellation is Canceled?

  •   Change the status of the UIN/GSTIN/GSTP ID from “Proceeding for Cancellation initiated” to “Inactive,” and notify any other relevant Tax Authorities.
  •   The taxpayer won’t be able to submit a return or invoices for the period after the cancellation order’s effective date.
  •   After a cancellation order has been issued, the taxpayer will no longer be able to change their registration information. You may alter your contact info (including email and cell phone) until any outstanding balances or refunds are resolved.

Please take note that the revoke application feature will be available for the canceled registration.

After Receiving A Cancellation Notice, What Recourse Does The Taxpayer Have?

Within seven working days of the taxpayer’s receipt of the Show Cause Notice, the taxpayer must respond (SCN).

  •   The officer can dismiss the proceedings if the taxpayer’s response convinces them.
  •   By both short message service (SMS) and electronic mail (email), the primary authorized signatory will be informed of the removal of the SCN.
  •   The taxpayer can view, print, and download the order from their dashboard.
  •   When this happens, GSTIN will go from being in a suspended state to an active one.

The officer may move forward with the cancellation of registration if they do not receive a response within seven business days.

When a GSTIN is deactivated, what functions are available in the GST portal?

When a taxpayer applies to have their registration canceled, or a Tax Officer initiates cancellation “Suo Moto,” the GSTIN will show as “Suspended.”

Following the suspension of GST, a taxpayer can do the following on the GST portal:

When will the GST freeze go into effect?

If a taxpayer initiates cancellation of registration, the date of suspension will be the date on which the cancellation application was filed; if the GST officer starts cancellation of registration “Suo Moto,” the date of suspension will be the date on which the SCN for cancellation of registration is issued.

Can I still file my prior period’s GST returns if I cancel my “Suo Moto” registration?

After a suo moto cancellation, GST Returns can be filed for the prior period (i.e., the time before the date of cancellation specified in the cancellation order).

However, the taxpayer is not permitted to submit a return or invoices for the time period following the cancellation order’s effective date. Furthermore, GSTP will be unable to act on your behalf to perform GSTP duties for the period after the cancellation date specified in the cancellation order.

How can I get my GSTIN activated once it has been temporarily suspended?

A GSTIN that is currently in the “Suspended” status will be returned to the “Active” status if and only if the officer rejects the cancellation of the registration application or the suo moto cancellation process is abandoned after the hearing. When a taxpayer’s GSTIN is moved from the “Suspended” to the “Active” state, he is once again considered an active taxpayer and has full access to the GST Portal, as is the case for all active taxpayers.

Read more at: Suo moto cancellation of GST registration

Read more at: Suo moto Cancellation: Registration if no response is provided within the allotted 7 working days

FAQs > Suo Moto Cancellation

1. Under which circumstances can a Tax Official initiate for cancellation of GST registration?

Suo Moto Cancellation of registration may be initiated by the Tax Official for various situations as mentioned in the provisions of GST law like: –

  • Any Taxpayer other than composition taxpayer has not filed returns for a continuous period of six months
  • Supplies any goods and / or services without issue of any invoice, in violation of the provisions of the Act or rules made thereunder, with the intention to evade tax
  • Issues any invoice or bill without supply of goods and/or services in violation of the provisions of this Act, or the rules made thereunder leading to wrongful availment or utilization of input tax credit or refund of tax
  • Collects any amount as representing the tax but fails to pay the same to the account of the Central/State Government beyond a period of three months from the date on which such payment becomes due
  • Fails to pay any amount of tax, interest or penalty to the account of the Central/State Government beyond a period of three months from the date on which such payment becomes due
  • Person is no longer liable to deduct tax at source as per the provisions of GST Law
  • Person is no longer liable to collect tax at source as per the provisions of GST Law
  • Person no longer required to be registered under provisions of GST Law
  • GST Practitioner is found guilty of misconduct in connection with any proceeding under the GST Law.
  • Discontinuation/Closure of Business
  • Change in Constitution leading to change in PAN
  • Ceased to be liable to pay tax
  • Transfer of business on account of amalgamation, merger/demerger, sale, lease or otherwise disposed of etc.
  • Death of Sole Proprietor
  • Composition person has not furnished returns for three consecutive tax periods,
  • Registration has been obtained by means of fraud, willful misstatement or suppression of facts. Etc.

2. Will I be intimated before the Suo Moto Cancellation of Registration?

Yes. Registration cannot be cancelled without a Show Cause Notice being given to taxpayer and a reasonable opportunity of being heard by the Tax Official. Thus, in case of Suo Moto cancellation of registration, a Show Cause Notice shall be issued by the Tax Official/ Proper officer to the taxpayer and taxpayer would be given a chance to file clarifications in the stipulated time limit.

3. What is the precondition for Suo Moto Cancellation of Registration?

There must be a valid reason for initiation of proceeding for Suo moto cancellation as specified under Section 29(2) of the CGST/SGST Act.

4. What is the duration within which I need to file a response for Show Cause Notice regarding Suo Moto Cancellation of Registration?

You need to provide response within the prescribed time limit of 7 working days’ time to file reply to the Show Cause Notice (SCN) using the Services > Registration > Application for Filing Clarifications link. If no response is given within prescribed 7 working days, the Tax Official can proceed with Cancellation of registration.

Read more at: ICAI’s suo motu power to initiate disciplinary proceedings under S 21 of the Chartered Accountants Act, 1949

5. What will happen once Show Cause Notice is Dropped?

In case the Tax Official is satisfied with the response received from the taxpayer, on the Show Cause Notice issued, the proceedings can be dropped.

  1. Primary Authorized Signatory will be intimated about dropping of SCN by SMS & Email.
  2. Issuance of Order for dropping of SCN will also be intimated to the Primary Authorized Signatory by Email and SMS.
  3. Order will be made available on the taxpayer’s dashboard to view, print and download.
  4. Status of GSTIN will change from “Suspended” to “Active”.

6. What shall be the effective date of cancellation of registration?

Effective date of cancellation will be the date as mentioned in the cancellation order.

7. Will the cancellation of registration means that I have no liabilities?

No, any liabilities prior to the date of suo moto cancellation will have to be paid by the taxpayer, irrespective of the fact that when determination of liabilities are done.

Any liability which is related to that particular GSTIN is required to be paid by the taxpayer. It can be recovered later on even after the cancellation of GSTIN.

8. Will the Suo moto Cancellation of registration be proceeded separately for each act?

Cancellation of registration under the CGST Act or SGST/UTGST or IGST Act shall be deemed to be a cancellation of registration under SGST Act / UTGST Act or CGST Act respectively and vice versa.

9. What will happen once Registration is cancelled?

a)    Once registration is cancelled by the Tax Authority, the taxpayer will be intimated about the same via SMS and Email.  Order for Cancellation of Registration will be issued and intimated to the Primary Authorized Signatory by Email and SMS.

b)    Order will be made available on taxpayer’s dashboard to view, print and download.

c)     Status of the GSTIN/UIN/GSTP ID from ‘Proceeding for Cancellation initiated’ to ‘Inactive’ and will be intimated to the other concerned Tax Authority.

d)    Taxpayer would not be allowed to file return or upload invoices for the period after date of cancellation mentioned in the cancellation order. Also, GSTP will not be able to carry out GSTP functions for any Taxpayer for the period after the date of cancellation mentioned in the cancellation order.

e)    Taxpayer will not be able to amend registration details after issuance of cancellation order. However, email address and mobile number can be updated till dues/ refund are cleared. The facility to file application for revocation (if applicable) will be open for the Cancelled Registration.

10. Will I be able to login after suo moto cancellation of registration?

Yes, you can login to the GST Portal after suo moto cancellation of registration.

11. Can I update my email and mobile after suo moto cancellation of registration?

You will not be able to amend registration after issuance of cancellation order.

However, email address and mobile number can be updated till dues/ refund are cleared. 

12. Can I submit returns of the earlier period after suo moto cancellation of registration?

You can submit returns of the earlier period (i.e. for the period before date of cancellation mentioned in the cancellation order), after suo moto cancellation of registration. However, you will not be allowed to file return or upload invoices for the period after date of cancellation mentioned in the cancellation order. Also, GSTP will not be able to carry out GSTP functions on your behalf for the period after the date of cancellation mentioned in the cancellation order.

13. Where can I view the Show Cause Notice regarding Suo Moto Cancellation of Registration?

Navigate to Services > User Services > View Notices and Orders to view the Show Cause Notice regarding Suo Moto Cancellation of Registration.

To know more, you can refer the manual https://tutorial.gst.gov.in/userguide/taxpayersdashboard/index.htm#t=View_Notices_and_Demand_Orders.htm

14. How can I reply to the Show Cause Notice regarding Suo Moto Cancellation of Registration?

To reply to the Show Cause Notice related to Suo Moto Cancellation, Navigate to Services > Registration> Application for Filing Clarifications.

The application is displayed for filing clarification. The reason for cancellation provided by Tax Officer will be displayed in the form. You can enter your Response.

Note: Taxpayer is required to submit his/her response to each of the cancellation reasons invoked by the tax officer in the notice.

15. Where can I view the date for personal hearing regarding Suo Moto Cancellation of Registration?

Navigate to Services > User Services > View Notices and Orders to view the Show Cause Notice regarding Suo Moto Cancellation of Registration. Download the notice to view the personal hearing date.

To know more, you can refer the manual https://tutorial.gst.gov.in/userguide/taxpayersdashboard/index.htm#t=View_Notices_and_Demand_Orders.htm

16. Where can I view the order regarding Suo Moto Cancellation of Registration?

Navigate to Services > User Services > View Notices and Orders to view the order regarding Suo Moto Cancellation of Registration.

To know more, you can refer the manual https://tutorial.gst.gov.in/userguide/taxpayersdashboard/index.htm#t=View_Notices_and_Demand_Orders.htm

17. Can I submit application for cancellation of registration, in case Tax Official has already initiated the suo-moto cancellation of Registration?

No, you cannot submit application for cancellation of registration, in case Tax Official has already initiated suo-moto cancellation of your Registration.

18. The status my GSTIN is showing as “Suspended” under My Profile. Why?

When a taxpayer files an application for cancellation of registration or Suo Moto cancellation has been initiated by the Tax Official, the status of the GSTIN is shown as “Suspended”. This will be changed to “Active” only when application for cancellation of registration is rejected by the Tax Official or Suo Moto cancellation proceeding is dropped, after hearing.

19. The status my GSTIN is showing as “Suspended” under My Profile. Can I perform any activity on the GST Portal?

When the status of your GSTIN is showing as “Suspended” status, you can perform certain activities on GST Portal like filing Appeal, making payment, filing for Refunds, reply to Assessment/Recovery/ Enforcement related orders/ notices, even make non-core amendment etc..

However, once GSTIN is suspended:

  • During the suspension status, taxpayer will be allowed to file return or upload invoices only for the period before the registration was suspended.
  • Taxpayer will not be able to file core amendment application till the time registration is suspended. However, email address and mobile number can be updated till dues/ refund are cleared.

20. What is the effective date of suspension?

21. What will happen once the status is changed from “Suspended” to “Active”?

Once the status of GSTIN is changed from “Suspended” to “Active”, you will be again treated as an Active taxpayer and all the accesses given to the Active taxpayers on GST Portal will be enabled for you immediately. 

23. What happens if I have filed all my due returns after SCN has been issued by the system for non-filing of Returns/Statements and my status becomes suspended?

Once all the due returns are filed, further proceedings will be auto dropped for cancellation of the GSTIN where SCN has been issued for non-filing of Returns/Statements by the system and the registration status would become active even if you have not responded to the SCN issued.

24. I have filed all my due returns. However, my registration status is still showing as Suspended. How can I update my status?

Once all the due returns are filed, proceedings will be auto dropped for cancellation of the GSTIN in cases where SCN has been issued for non-filing of Returns/Statements by the system and your status will change from ‘Suspended’ to ‘Active’.
In case proceedings are not dropped automatically, 


a) You can click on INITIATE DROP PROCEEDING button to update your status.

b. Success message will be displayed, and proceedings will be auto dropped.

Read more at: WHAT IS SUO MOTO CANCELLATION AND HOW TO FILE APPLICATION FOR REVOCATION OF SUO MOTO CANCELLATION