Need for registration under CGST Act

[Lalitha Krishnamurthy]

A client (Individual) has income from Bank Fixed Deposits (which is exempt) and renting of commercial property to a registered entity (which is taxable on reverse charge basis). Though the aggregate income is more than Rs. 20 lakhs, he is not liable to pay tax under GST laws. Under the circumstances, is he required to register himself and file nil returns? Section 23(1)(a) of the CGST Act provides for exemption from registration to persons who are only engaged in making exempt supplies while Notification no. 5/2017 - Central Tax dated 19/06/2017, as amended by Notification no. 24/2024 - Central Tax dated 09/10/2024 provides for exemption from registration to persons who are only engaged in supplies subject to tax on reverse charge basis. In our opinion, registration is not required when the provisions are read together; would be grateful if the experts could confirm this. Thank you.

AI Summary

GST registration for commercial landlords depends on whether personal deposit interest is a supply and enters aggregate turnover.
GST registration depends on whether personal bank fixed-deposit interest is outside the scope of supply or is an exempt supply includible in aggregate turnover. If the deposits are personal investments and commercial renting is the only GST supply, with tax wholly payable by the registered tenant under reverse charge, the exemption for exclusive reverse-charge supplies supports non-registration. The contrary view includes deposit interest in aggregate turnover, requires registration on crossing the threshold, and treats commercial rent as taxable under forward charge after registration.