Normal gst cancelation and refund

Since your GST registration is voluntary and your turnover is below the threshold, you may apply for cancellation of GST registration on the GST portal. However, the ITC taken on the machine cannot normally be claimed as refund merely due to cancellation. On cancellation, ITC on capital goods has to be reversed/paid after reducing 5% per quarter or part thereof from the invoice date, or tax on transaction value, whichever is higher. After cancellation order, GSTR-10 final return must also be filed.

Since your GST registration was obtained on a voluntary basis and your turnover is below the prescribed threshold, you may proceed with cancellation of GST registration through the GST portal.

However, please note that the Input Tax Credit (ITC) of ₹69,000 on machinery cannot be claimed as a refund upon cancellation. As per GST provisions, at the time of cancellation, you are required to reverse/pay ITC on capital goods after reducing 5% per quarter (or part thereof) from the date of invoice, or pay tax on the transaction value, whichever is higher.

Additionally, after cancellation is approved, you must file the Final Return (GSTR-10) within the prescribed time limit.

If you need professional assistance for GST cancellation and compliance, you may connect with Setindiabiz for end-to-end support.

When you cancel GST, you must file GSTR-10 (the final return) within 3 months of cancellation. Any remaining balance in your electronic cash ledger can then be claimed as a refund by filing an application (RFD-01) on the GST portal. The credit ledger balance is a different story: any unclaimed ITC at the time of cancellation has to be reversed and paid back to the government.

 If you need help filing GSTR-10 or the refund application, a CA can usually get this done in a day.