The Institute of Chartered Accountants of India (ICAI) has suggested a wide range of changes to the GST registration and refund processes, with a focus on reducing procedural hurdles, improving portal functionality and making compliance more predictable for taxpayers.
The suggestions have been submitted by ICAI’s GST & Indirect Taxes Committee for the consideration of the Government. The proposed reforms cover both GST registration and GST refunds, including application tracking, biometric verification, document uploads, registration cancellations, refund validation and delayed refund interest.
The recommendations largely seek to address situations where technical limitations on the GST portal can create additional compliance difficulties even when the taxpayer is otherwise compliant.
ICAI Proposes Single-Window GST Registration for New Companies and LLPs
One of the key suggestions is to improve the integrated GST registration facility available through the MCA portal during incorporation.
At present, GST applications filed alongside company or LLP incorporation through SPICe+ and AGILE-PRO-S may face transmission delays, data mismatches and limited visibility once information reaches the GST Network.
ICAI has suggested a more robust single-window registration system, with immediate validation, TRN generation and real-time status updates available through the MCA portal.
According to the committee, aligning GST registration with incorporation could help newly formed businesses begin operations without an avoidable compliance gap.
One PAN, One Biometric Verification for Multiple GST Registrations
ICAI has also proposed that biometric Aadhaar verification should be treated as a PAN-level validation rather than being repeated separately across States and Union Territories.
Under the suggested approach, once an applicant completes biometric verification successfully for one GSTIN, the verification status could be recognised for subsequent GST registrations linked to the same PAN.
The proposal is aimed at reducing repeated verification, travel requirements and duplication for businesses expanding across multiple States.
Separate GST Registration Categories for Shared and Co-Working Premises
With businesses increasingly operating from co-working spaces and virtual offices, ICAI has recommended clearer documentation requirements for such premises.
The committee has suggested adding dedicated portal categories for:
- Owned premises
- Rented premises
- Consent-based premises
- Shared premises
- Co-working premises
The portal could then generate the relevant document checklist automatically. ICAI has also suggested issuing specific guidelines for proof of place of business and verification procedures for virtual and co-working offices.
Higher Document Upload Limits and Multiple-File Facility
Another practical issue highlighted by ICAI is the difficulty taxpayers face while uploading large or multi-page documents.
The committee has suggested increasing the document upload limit to 5 MB, along with an in-portal PDF compression facility, multiple-file uploads and an alternative secure upload mechanism for larger documents.
The objective is to prevent genuine documents such as lease agreements and registered sale deeds from becoming unreadable because of excessive compression.
GST Portal May Allow More Than 10 Partners or Promoters
ICAI has recommended removing the existing portal-level restriction that limits the number of partners or promoters that can be entered during GST registration to 10.
The proposed functionality would allow applicants to enter details of all partners or promoters, irrespective of their number, so that GST registration records accurately reflect the constitution of the entity.
Preview Option Before Final GST Registration Submission
The committee has proposed introducing a preview facility before an applicant finally submits a GST registration application.
The preview would allow taxpayers to check the complete application and uploaded documents before generating the ARN. ICAI believes this could help catch typographical errors, incorrect details and wrong attachments before submission, potentially reducing avoidable notices and rejections.
Changes Suggested for Bank Account Validation and Auto-Suspension
ICAI has also highlighted difficulties arising from automated bank account validation, particularly in cases involving proprietorships, cooperative banks, small finance banks, payment banks and minor name differences.
It has suggested introducing fuzzy name matching, recognising a proprietor's personal bank account where the PAN matches the GST registration, and providing an online manual validation mechanism when automated validation fails.
The committee has further proposed alerts at Day 15, Day 25 and Day 29 before registration suspension is triggered.
ICAI Wants More Specific GST REG-03 Queries
A major recommendation concerns queries issued in FORM GST REG-03.
ICAI has pointed out that generic queries such as requests for valid proof of the principal place of business can make it difficult for applicants to understand exactly what needs to be corrected.
It has proposed that officers be required to identify the specific field or document to which the query relates and provide a reasoned explanation. Generic options such as "Others" should not be available without a mandatory explanation, according to the recommendation.
Reasoned GST Registration Rejection Orders and Hearing Facility
ICAI has suggested changes to FORM GST REG-05, stating that rejection orders should clearly explain why an applicant's response was not accepted.
The proposed format would capture the query raised, the reply received, the reason for rejecting the reply and the specific legal provision under which the rejection is made.
The committee has also suggested giving applicants an option to choose between virtual and physical personal hearings during the registration process.
GST Registration Activity Log Like Courier Tracking
One of the more user-friendly proposals is a Registration Activity Log that would allow taxpayers to track the movement of an application.
The proposed sequence could show stages such as:
Application submitted → ARN generated → Assigned to officer → Verification initiated → Query issued → Reply filed → Physical verification ordered → Report uploaded → Approval/Rejection
ICAI says such visibility could improve transparency and accountability for both taxpayers and tax authorities.
System-Enforced Deemed Approval Under Rule 9(5)
ICAI has also proposed that the GST portal should automatically enforce deemed approval under Rule 9(5) where the prescribed timeline expires without the required action.
The suggestion includes automatic generation of FORM GST REG-06, a visible "Days Pending" counter and escalation to supervisory officers when timelines are breached.
Easier Access for Suspended or Cancelled GSTINs
Another recommendation seeks to prevent portal restrictions from blocking taxpayers from exercising their statutory remedies after suspension or cancellation.
ICAI has proposed that suspended or cancelled GSTINs retain read-only access to their data, while taxpayers should continue to have access to notices and orders, appeal filing, revocation applications, final returns and replies to pending notices.
ICAI Seeks Faster GST Refund Processing
The recommendations also cover several technical issues affecting GST refunds.
ICAI has suggested changes to the Annexure-B offline utility, including a field for reclaimed ITC to properly capture the sequence of availment, reversal and subsequent re-availment.
It has also proposed allowing a tolerance of up to ₹1 per tax component for minor rounding differences, arguing that insignificant computational differences should not prevent otherwise valid refund claims.
Greater Auto-Population of GST Refund Data
The committee has recommended greater integration between the GST portal and existing data sources.
Under the proposal, refund statements could be substantially auto-populated using data from GSTR-1, GSTR-2B and ICEGATE, while applicants would retain the ability to edit information and add remarks.
ICAI has also suggested more detailed, row-wise error reports and greater tolerance for minor variations in invoice numbers and dates.
GST Portal Should Allow Correction of Wrong Refund Category
ICAI has proposed giving proper officers a facility to transfer a refund application to the appropriate category where the taxpayer has selected an incorrect refund category but the underlying claim is otherwise eligible.
The recommendation is intended to reduce unnecessary withdrawal and re-filing of refund applications and minimise the risk of procedural errors affecting statutory refund timelines.
Two-Year Refund Limitation Should Consider the Relevant Date
The committee has also raised concerns over the portal's hard-blocking of refund applications based simply on the age of the tax period.
ICAI has suggested replacing the hard block with a soft validation that allows the applicant to select the applicable "relevant date", enter the date and provide supporting documents for the officer's examination.
The proposal is aimed at ensuring that portal validation does not override the different limitation rules applicable to different refund categories.
Automatic Interest Calculation on Delayed GST Refunds
Another significant recommendation concerns interest on delayed refunds under Section 56.
ICAI has proposed that the GST portal should automatically calculate the applicable interest while generating FORM GST RFD-05, instead of requiring taxpayers to file a separate application to claim the interest.
The committee has suggested automatic computation from the relevant 60-day threshold, subject to recording any specific excluded period and reason where applicable.
Faster Refund of Electronic Cash Ledger Balance
For straightforward refund categories such as excess balance in the electronic cash ledger, ICAI has suggested a simplified mechanism.
Where there is no outstanding demand, the committee has proposed that such refunds could be auto-sanctioned, with RFD-05 generated within seven days without officer intervention, subject to post-facto review.
Self-Service Re-credit of Rejected Refund Amount
ICAI has further recommended a self-service mechanism for re-crediting the rejected portion of a refund claim back into the Electronic Credit Ledger through FORM GST PMT-03/PMT-03A.
This could be particularly useful where the taxpayer does not intend to appeal against the rejection, as it would avoid unnecessary dependence on manual intervention by the proper officer.
Refund of Advance Deposit Where GST Registration Is Rejected
The final recommendation in the document addresses advance tax deposits made by casual taxable persons (CTPs) and non-resident taxable persons (NRTPs).
ICAI has proposed introducing a dedicated refund category on the GST portal for refunding advance deposits where the corresponding registration application has been rejected.
The committee believes a defined online mechanism would prevent taxpayers' funds from remaining blocked where registration has not been granted.
What the ICAI Recommendations Mean for Taxpayers
Taken together, the recommendations point towards a broader shift in GST administration: less dependence on manual intervention and greater reliance on transparent, automated and taxpayer-facing systems.
From registration to refund, several of the proposed changes focus on a common problem where a technical or procedural limitation on the GST portal can create additional compliance work for taxpayers.
However, these are ICAI suggestions submitted for the Government's consideration and should not be treated as implemented GST rules or portal changes unless separately notified or introduced by the competent authorities.
If implemented, the proposals could make GST registration more predictable, reduce repetitive verification and documentation, improve refund processing and give taxpayers greater visibility into the status of their applications.
Click here to view/download the complete list if suggestions proposed by ICAI
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