Section 29 provides for cancellation of GST registration either at the request of the taxpayer or by the GST department under specified circumstances.

When Can GST Registration Be Cancelled?

A. Cancellation on Application by Taxpayer

A registered person may apply for cancellation when:

• Business is discontinued or closed.
• Business is transferred due to sale, merger, demerger, amalgamation, etc.
• Change in constitution of business (e.g., proprietorship converted into company).
• Taxpayer is no longer liable for GST registration.
• Taxpayer opts for the Composition Scheme (where applicable).

Example:
Mr. A closes his trading business permanently. He can apply for cancellation of his GST registration.

B. Cancellation by GST Officer (Suo Moto)

The GST officer may cancel registration if:

• Business is not conducted from the declared place of business.
• Registration has been obtained by fraud, wilful misstatement, or suppression of facts.
• Returns are not filed for the prescribed period.
• The taxpayer violates provisions of the GST Act or Rules.
• Registration was obtained without commencement of business within the prescribed period.

Suspension of Registration

Before cancellation, the registration may be suspended.

During the suspension period:

• No taxable supplies can be made.
• No tax invoice can be issued.
• GST returns may not be required as prescribed.

The suspension continues until the cancellation proceedings are completed or revoked.

Effect of Cancellation

Cancellation does not automatically eliminate liabilities that arose before the date of cancellation.

The taxpayer remains liable for:

• Outstanding GST dues
• Interest
• Penalty
• Other legal obligations relating to the period before cancellation

Example

A company fails to file GST returns for several months despite notices from the department.

The GST officer may:

1. Suspend the GST registration.
2. Initiate cancellation proceedings.
3. Cancel the registration if no satisfactory response is received.

Section 28 vs Section 29

In One Line

Section 29 empowers the taxpayer or GST department to cancel GST registration and also provides for suspension of registration during cancellation proceedings.