Provisional ID under GST

[chetan jadhav]

A person was registered under service tax regime. His turnover never crossed Rs 20 lacs in service tax as well as GST regime thereafter.

He was alloted Provisional ID by service tax department but he did not migrate to GST. GSTIN Status as per GST portal as on date for provisional registartion granted is "Not Migrated".

Thereafter he took registartion in Year 2021 and continued therefater.

Query is -

1. What would be his status for period July 2017 to 2021 - ( IMHO, he is unregistered person during this period as he never migrated to GST)

2. Weather he is liable for tax during the above period (IMHO - He is not liable to tax as he was unregistered during the period and his tunover was less than Rs 20 Lacs)

Kindly advise.

Regards,

[Amit Agrawal]

Dear Shri Padmanathan Ji & my fellow professional colleagues,

Kindly allow me to play advocate for the contrarian view here

My whole Idea is to make all these discussions as engaging, relevant & interesting by testing all potential legal interpretations:

A. What is purpose of the wording of Section 139 (3):

"The certificate of registration issued to a person under sub-section (1) shall be deemed to have not been issued if the said registration is cancelled in pursuance of an application filed by such person that he was not liable to registration under section 22 or section 24"

A1. How to interpret BOTH section 22 (2) and above-highlighted portion from Section 139 (3) harmoniously?

A2. Please also note the wordings used in rule 24 (4) & FORM GST REG-29 i.e. "who is not liable to be registered under the Act" as well as Section 23 (i.e. Persons not liable for registration) & Section 25 (1) (i.e. Every person who is liable to be registered under section 22 or section 24 ...) , while solving above-explained conundrum.

B. Please read Section 29 (1) where reason/s - for which a registered person can seek cancellation of registration - are listed. If one interpret that the Section 139 (3) does NOT apply to a migrated person, due to mandated registration under Section 22 (2), does that mean that such person can NEVER seek cancellation of his registration u/s Section 29 (1) (i.e. even when his aggregate turnover never exceeds Rs. 20 Lac in a financial year) EVER (i.e. unless his case is covered under clause (a) or (b) of Section 29 (1) as his case will never fall under any reasons listed u/s 29 (1) (i.e. clause (c) of Section 29 (1)?

C. If a registered person can seek cancellation of his existing registration if his aggregate turnover in a financial year does not exceed Rs. 20 Lac (a view, you seem to imply), then, why same privilege does not apply to a person who is bound to take & has taken registration as per Section 22 (2)? And if same privilege is indeed available, then, why such privilege is not available to him as on appointed day itself?

Kindly note that I have not shared any views in this post. It is just that I find these are relevant questions before one decide the issue raised by the Querist.

These are ex facie views of mine and the same should not be construed as professional advice / suggestion.

[Padmanathan KV]

Kasturi Ji,

Yes. I do agree.

Provided "he was not holding registration under erstwhile Act" and not liable for compulsory registration under section 24.

So, my point here is since he was registered under erstwhile Law, the threshold limit of 20 lakhs becomes irrelevant.

And it becomes irrelevant for subsequent years as well due to logic I explained earlier.

This is my current understanding. (I shall address Amit ji's poser after a more detail study, which he always makes us do)

[Amit Agrawal]

In my last post, In Para A, please also consider the following as part of conundrum:

A3. As on start of appointed day, there was NO person who was required to be registered u/s 22 (1) everyone's aggregate turnover was zero at the start.

[KASTURI SETHI]

Interpretational dispute still hangs on. Come on with some authority as suggested above by Sh.Amit Agrawal,Sir

[Amit Agrawal]

@ Shri Kasturi Sethi Ji,

Only because you have said 'Based on the analysis of various case laws on the issue' in post at serial no. 17 above, in my post at serial No. 18, I had suggested to let us have detailed analysis after taking into account the point of dispute with supporting case-laws relevant thereon.

As you know, I have left open the question of the consequential question/s of tax-liability and more importantly, till what period (in my post at serial No. 15 above). This is most important element for the matter under discussion here. And I am working towards that.

I have already shared some potential pointers explaining complexities - in this regard - in my last post at serial no. 21.

I was expecting help & support from professional colleagues to solve the conundrum.

Anyway, I will try & come out with my conclusions soon.

[Padmanathan KV]

Learned Kasturi sir,

I generally refrain from quoting/ relying on Case Laws and AAR/AAAR rulings unless they are directly on an issue. Even in such scenarios, I only urge the querist to take cues from the judgements as many a times Judgements in GST are fact specific and in personam. (Many of the judges explicitly state this as well in their judgement). I usually rely on judgements only where question of law is has been addressed and where Principles of natural justice has been violated.

I refrain from making any reference to "authority" because I do not find any case-law directly addressing this point.

I have also explained to the best of my ability, my views on the query, replying on the applicable provision in law.

[KASTURI SETHI]

Sh. Padmanathan Kollengode Ji,

Yes. You are absolutely right. Otherwise also original thoughts should not be clouted by the decisions of ANY court. The virtue of originality makes one unique. Without the element of originality, we are lost in the crowd.

[KASTURI SETHI]

Sh.Amit Agrawal Ji,

W.r.t. your response at serial no.25 above, I am indebted to you for your continued concerted efforts to arrive at crystal clear picture in the interest of all. Your hard work is peerless.

AI Summary

Liability to register under migration rules may impose GST obligations from appointed day despite low turnover.
Issue: whether a person registered under the erstwhile service tax law who did not migrate and whose turnover remained below the threshold is liable to GST from the appointed day until registration in 2021. Key statutory provisions considered include Section 22(2) (liability for those registered under existing laws), Section 139 (provisional migration and deemed cancellation), Rule 24 (cancellation of provisional IDs), and definitions of "taxable person" and "registered person." Two competing views emerge: one treating migration as creating immediate and continuing liability; the other treating provisional migration as procedural, preserving threshold exemption absent final registration.