GST Update No 209 on registration is a burdensome process

Under taxation regime, granting registration under GST is a beneficial compliance made by the government to increase the revenue base. However, looking into the present scenario, it is not less than a nightmare for the taxpayers to get themselves registered. The revenue authorities are also reluctant enough to grant registration application and tend to reject them on frivolous and arbitrary grounds which are not even prescribed under statue. There had been various cases in this regard wherein the businessman suffered the agony of these practices adopted by the revenue authorities. To illustrate, the author of this update came across the situation wherein for the purpose of registration of windmill as an additional place, the revenue authorities demanded documents related to PF, ESI, electricity bills etc. as a condition of granting registration. In another case, the birth certificate was being called upon by the Government Officials. Not only this but also, for a registration address of a service provider, they have asked whether this premises can be used for commercial purposes. For letting out a factory owned by RIICO, they ask for the pollution NOC. In yet another case of addition of agricultural goods lying in a NCDEX godown, they asked whether company accounts are maintained at the above premises.

As per the provisions of law, warehouse is required to be declared as additional place of business where record of entry and exit is being maintained but it is not possible to maintain accounts of the company at the warehouse. In case of rented premises, officers ask for chain of documents of property which they also know that the owner of property will not provide in any case. As such, the wishlist of the department is very wide. We have already prepared similar update on the rejection of registration application as “GST Update-125 rejection of registration application for non-submission of electricity bills”.

The harsh reality is hidden from no one. The revenue authorities are stubborn and do not adhere to the legal framework and the provisions of the statue. They neither pay attention to the replies filed by the assessees nor consider them while rejecting their registration applications. The requirement of documents for granting registration is clearly prescribed under Rule 8 of CGST Rules, 2017 pertaining to Chapter III. The prescribed documents related to the said rule are:-

1. PAN number of the applicant

2. Proof of business registration

3. Identity and address proof of promoters with photographs

4. Address proof of place of business

5. Bank Account/ Statement

6. DSC of Authorised Signatory

Consequently, this results into increase in miseries and hardships faced by the taxpayers. The basic intent behind introduction of GST regime being “Ease of doing Business” seems to have faded away.

In this respect, reference is made to the Allahabad High Court decision in the case of RANJANA SINGH V/S COMMISSIONER OF STATE TAX, wherein it is held that non-submission of receipt of electricity bill is not a ground of rejection of registration application. It is high time that the revenue authorities should abide by these Court Rulings which they are bound to follow and avoid unnecessary litigations and wasting the precious time of court. Moreover, the Government should employ well qualified human resources, intelligence wings etc. to terminate these malpractices adopted by the departmental officers at the earliest possible failing which will result into loss of revenue to both the Government and the taxpayers. A prompt action from the Government in such situations is highly anticipated by the business community.

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GST Update No 209 on registration is a burdensome process

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