Two different situations
GST cancellation comes up in two ways, and they need different handling.
- You want to close your GSTIN because the business has stopped, been sold, changed its constitution, or turnover has fallen below the threshold where registration was not compulsory.
- The department wants to cancel your GSTIN, or has already cancelled it, usually because returns were not filed, the premises could not be found, or the registration was linked to suspicious transactions.
Closing a GSTIN casually, without filing returns or paying the closing stock liability, leads to notices later. Ignoring a cancellation notice is worse: the GSTIN goes, buyers lose credit on your invoices, marketplaces stop your account, and restoring it takes time.
Voluntary cancellation (REG-16)
You can apply for cancellation under Section 29(1) where:
- The business has been discontinued, transferred, amalgamated or demerged.
- The constitution of the business has changed, for example a proprietorship converted into a company.
- You are no longer liable to be registered and had taken voluntary or threshold registration.
| Step | What happens |
|---|---|
| Clear pending returns | File GSTR-1 and GSTR-3B up to the date of application |
| Work out closing stock liability | ITC on stock and capital goods, or output tax, whichever is higher |
| File REG-16 | Reason, date of cancellation, stock details and liability |
| Officer review | Officer may seek clarification; we reply within the time given |
| Order in REG-19 | Cancellation order, normally within thirty days of the application |
| Final return GSTR-10 | Within three months of the cancellation date or order date, whichever is later |
Cancellation does not remove liability for earlier periods. Notices for past years can still be issued after cancellation, so keep your records.
Cancellation by the officer (REG-17 and REG-19)
The proper officer can cancel registration under Section 29(2), including where:
- Returns have not been filed for the continuous period prescribed, which for monthly filers is six months.
- A composition taxpayer has not filed the return for a financial year beyond three months from its due date.
- Business is not being carried on from the declared place of business.
- Registration was obtained by fraud, wilful misstatement or suppression of facts.
- Invoices have been issued without supply of goods or services, or ITC has been claimed or passed on in violation of the law.
- The registration was voluntary and business did not start within six months.
The officer first issues a show cause notice in REG-17. You must reply in REG-18 within seven working days of service. If the reply is accepted, the proceedings are dropped in REG-20. If not, the cancellation order is passed in REG-19.
A short, reasoned REG-18 reply, with pending returns filed and proof of business activity at the premises, can stop most cancellations for non-filing.
Suspension of registration
Under Rule 21A, the registration is suspended from the date of the cancellation application or notice, until the matter is decided. The system can also suspend a GSTIN where returns show significant differences, for example between GSTR-1 and GSTR-3B, or between GSTR-3B and GSTR-2B. The grounds are communicated in REG-31.
| During suspension | Effect |
|---|---|
| Taxable supplies | Cannot be made |
| Returns | Must still be filed |
| Refunds | Not granted |
| Buyers’ ITC | Invoices issued during suspension may be questioned |
The quickest way out of suspension is to correct the default and reply on the portal with an explanation. We prepare the reconciliation behind that reply. If you have received a wider notice along with the suspension, see our GST notice reply service.
Revocation of cancelled registration (REG-21)
If your GSTIN has been cancelled by the officer, you can apply for revocation under Section 30, read with Rule 23. Revocation restores the same GSTIN, which matters for your buyers, suppliers, marketplaces and bank.
| Point | Position |
|---|---|
| Who can apply | A person whose registration was cancelled by the proper officer on his own motion |
| Form | REG-21 |
| Time limit | Ninety days from the date of service of the cancellation order |
| Extension | Up to a further one hundred and eighty days, allowed by the Commissioner or an authorised officer on sufficient cause |
| Pre-condition where cancelled for non-filing | All returns due up to the date of cancellation filed, with tax, interest, late fee and penalty paid |
| Officer’s options | Revoke in REG-22, or issue a notice in REG-23 before rejecting |
| Your reply to REG-23 | REG-24, within seven working days |
| Rejection | Order in REG-05, which can be appealed |
Revocation cannot be sought where you yourself applied for cancellation. In that case, a fresh registration is the route.
Order of steps for revocation
- Read the cancellation order. We check the ground, the date of service and the date from which cancellation is effective.
- Count the time. We confirm whether you are within ninety days, or need to ask for an extension with reasons.
- File pending returns. All returns up to the date of cancellation are filed, and any returns for the period after cancellation are dealt with as required by the rules.
- Pay dues. Tax, interest and late fee are paid. We check the three-year time bar on filing old returns, because returns more than three years past their due date can no longer be filed on the portal.
- File REG-21. The application sets out the reasons for default and the corrective steps, with supporting documents.
- Answer the officer. Any notice in REG-23 is answered in REG-24 within the time allowed.
- Appeal if rejected. A rejection is taken up before the Appellate Authority through our GST appeals service.
Mistakes that delay cancellation or revocation
- Filing REG-16 while returns are still pending.
- Not declaring closing stock and capital goods in REG-16.
- Forgetting GSTR-10 after cancellation, leading to a notice and a best judgment assessment.
- Ignoring a REG-17 notice because the business was “anyway slow”.
- Applying for revocation without filing all pending returns, so the application is rejected.
- Letting both the revocation period and the appeal period lapse.
Why work with KSV on cancellation and revocation
- Correct sequence. Returns, payments and applications are done in the order the law requires.
- Formal replies. REG-18, REG-24 and appeal submissions are drafted in formal language with documents.
- Representation. Kailash Vashisht appears as authorised representative for clients before GST authorities.
- Ongoing compliance. Once restored, our GST return filing service keeps your GSTIN active.
We handle cancellation and revocation for businesses across Gurugram, including Sohna Road, Udyog Vihar and IMT Manesar, and for clients in Delhi, Haryana, Uttar Pradesh, Rajasthan and Chhattisgarh. Contact us with your cancellation order or notice.
Frequently asked questions
How do I surrender my GST registration?
File an application in Form REG-16 on the GST portal, giving the reason, the date from which cancellation is sought and details of stock held on that date. All returns up to the date of application should be filed first. The officer normally passes the cancellation order in REG-19 within thirty days of the application, or seeks a clarification.
Do I have to pay tax on closing stock when I cancel?
Yes. Under Section 29(5), you must pay an amount equal to the input tax credit on inputs held in stock, inputs in semi-finished and finished goods, and capital goods, or the output tax on such goods, whichever is higher. Capital goods are calculated as prescribed in the rules. This is declared in REG-16 and in the final return.
What is GSTR-10?
GSTR-10 is the final return to be filed by a person whose registration is cancelled, whether voluntarily or by the officer. It is due within three months of the date of cancellation or the date of the cancellation order, whichever is later. If it is not filed, the officer can issue a notice and then assess the liability.
My GSTIN was cancelled for not filing returns. Can it be restored?
Usually yes. You can apply for revocation in REG-21 within ninety days from the date of service of the cancellation order. Before applying, all pending returns up to the date of cancellation must be filed and the tax, interest, late fee and any penalty paid.
What if the ninety days have passed?
Under Rule 23, the Commissioner or an officer authorised by him may extend the time by a further period of up to one hundred and eighty days, on sufficient cause being shown. Beyond that, the remedy is an appeal under Section 107 against the cancellation order, filed within its own time limit.
What is suspension of GST registration?
When cancellation proceedings are started, or when the system finds serious discrepancies in your returns, the registration can be suspended under Rule 21A. During suspension you cannot make taxable supplies or obtain refunds, and you are informed of the grounds through REG-31 or the cancellation notice. If the proceedings are dropped, the suspension is revoked from the date it took effect.
Kya GST band karne ke baad dobara registration le sakte hain?
Haan. After voluntary cancellation, a fresh registration can be taken later if your business restarts. But if your registration was cancelled by the officer, it is better to seek revocation, because a fresh application may be questioned while old dues are pending.
Can I appeal if the revocation application is rejected?
Yes. A rejection of revocation is an appealable order. An appeal can be filed with the Appellate Authority under Section 107 within three months of communication of the order, with a further one month on sufficient cause. We review the rejection order and prepare the appeal.