GST Updates by CA Rahul Gupta

Section Section 23 of CGST Act i.e. Persons not liable to be registered under GST

Financial Year: 2017

Section 23 of CGST Act

Persons Not Liable For Registration

(1) The following persons shall not be liable to registration, namely:––

(a) any person

engaged exclusively in the business of

supplying goods or services or both that

are not liable to tax or wholly exempt from tax

under this Act or under the IGST Act;

(b) an agriculturist,

to the extent of supply of

produce out of cultivation of land.

(2) The Government may,

on the recommendations of the Council,

specify the category of persons who

may be exempted from obtaining registration under this Act.

Notification No 05/2017 Central Tax dated 19th June 2017

Central Govt exempts persons from registration who

are providing taxable supplies of goods or services or both but

tax is to be paid by receiver on reverse charge basis by the receiver

Example :- Transporters who doesn’t want to charge 12% GST are exempted from GST Registration vide

this notification.

Notification No 65/2017 Central Tax dated 15th November 2017

Central Govt exempts persons from registration

who are providing taxable supplies of services having

aggregate Turnover of ?20 lakhs (?10 lakhs in case of special category states) or less in a financial year,

however Electronic Commerce Operator as specified under section 9(5)

have not been exempt from obtaining registration.

Example :- Raman is a cab driver providing services through Uber ( which is an E Commerce Operator), in this Raman

is not required to obtain registration but Uber is required to obtain registration even if its turnover is only ?2 lakhs.

Notification No 10/2019 Central Tax dated 7th March 2019

Central Govt exempts persons from registration

engaged in exclusive supply of goods and

whose aggregate turnover in a financial year does not exceed ?40 lakhs

Exceptions:-

Persons liable for compulsory registration under section 24
Persons engaged in supply of goods specified below

Ice cream and other edible ice
Pan masala
Tobacco and manufactured tobacco substitutes

Persons not crossing the threshold limit as specified in section 22 of the act
Persons opting for voluntary registration

Notification No 7/2017 Integrated Tax dated 14th September 2017

Central Govt exempts job workers engaged in

Interstate supply of services

to a registered person.

Exemption:-

Persons liable under section 22(1) i.e who are exceeding the aggregate turnover as applicable to them.
Persons opting voluntary registration under section 25(3) of there said act.
Persons making supply of services in relation to jewellery goldsmith’s and silversmith’s wares and other articles.

Notification No 21/2018 UT Tax (Rate) dated 26th July 2018

Central Govt exempts persons from registration

engaged in exclusive in intra state supply of handicraft goods

Handicraft goods

Read with:

Notification No 56/2018 Central Tax dated 23th October 2018

Notification No 32/2017 Central Tax dated 15th september 2017

Notification No 21/2018 Central Tax(Rate) dated 26th july 2018

Notification No 03/2018 Integrated Tax dated 22th October 2018

Notification No 08/2017 Integrated Tax dated 14th September 2017

Conclusion:

Handicraft goods means goods predominantly made by hand even though some tools or machinery may also

have been used in the process; such goods are graced with visual appeal in the nature of ornamentation or

inn-lay work or similar work of a substantial nature; possess distinctive features, which can be aesthetic,

artistic, ethnic or culturally attached and are amply different from mechanically produced goods of similar

utility.

Persons making interstate taxable supplies of handicraft goods have been exempted by the central

government from obtaining registration under the said act.

Provided that the aggregate turnover does not exceed the threshold limit as applicable to them.

Also the casual taxable persons mentioned in the above paragraph shall obtain a PAN and generate an

e way bill in accordance with the provisions of rule 138.

Example:- Ram is a person in Haryana dealing in furniture whose aggregate turnover is below the

threshold limit of 40 lakhs, if he wants to make interstate supply of goods then he will have to obtain

registration even if the supply is of 1 rupee. But, if ram is a person suppling handicraft goods then he can

make interstate supply of handicraft goods and is not liable to get registration till his aggregate turnover is ?40 lakhs.

For list of goods and tax rates refer Notification No 21/2018 Central Tax (Rate) dated 26th July 2018

Thanks & Regards

CA Rahul Gupta