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Input credit at the time of cancellation

Adarsh babu (accountant) (17 Points)

27 January 2020

I want to cancel my gst registration from December and i have input crrdit of 400000 in my credit ledger What to do this input? and can i cancel my registration?

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3 Replies

CA Manisha (CA) (1397 Points)
Replied 27 January 2020

You can apply for cancellation of registration under Section 29(1) of the CGST Act, 2017 read with Rule 24(4) of CGST Rules, 2017. As per Section 29(5) of the CGST Act 2017, every registered taxable person whose registration is cancelled shall pay an amount, by way of debit in the electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock, or capital goods or plant and machinery, on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher. You may also refer to the provision to that sub-Section.

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RAJA P M ("Do the Right Thing...!!!") (127167 Points)
Replied 27 January 2020

What to do this input?
- The balance ITC will be reversible at the time of cancellation of registration.

and can i cancel my registration?
- Yes... You can cancel Your registration. But, Before that settle Your all liabilities.

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Pankaj Rawat (GST Practitioner) (55032 Points)
Replied 28 January 2020

Yes the Input lying in credit ledger will get lapse. if you are having any stock on date of cancellation you need to pay GST on same or your can adjust input lying in ECL.

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