CGST Section 24 — Compulsory registration in certain cases
CGST Act · Compulsory registration in certain cases
Quick Answer
Section 24 of the CGST Act, 2017 governs Compulsory registration in certain cases. It provides the core statutory basis, outlining the essential legal principles, rights, and liabilities under Indian indirect tax law. Section 24 GST: Compulsory registration in certain cases — eligibility, conditions, case laws and compliance impact under Indian tax law.
Plain-English Explanation
Section 24 of the CGST Act, 2017, overrides the general threshold exemption for GST registration outlined in Section 22. It essentially mandates certain categories of individuals and businesses to register for GST, regardless of their annual turnover. This means that even if your turnover is below the standard threshold limit (currently INR 20 lakh or INR 10 lakh in special category states), you must register for GST if you fall into any of the categories listed in Section 24.
This section is crucial for businesses to understand because failing to register when required can lead to penalties and legal complications. Let's break down the categories covered by Section 24:
-
Inter-State Taxable Supply: If you are making any supply of goods or services from one state to another, you must register for GST. Even a single inter-state transaction triggers this requirement.
- Example: A small handicraft business in Rajasthan selling its products to customers in Maharashtra through its own website is required to register for GST even if their annual turnover is below INR 20 lakh.
-
Casual Taxable Person: This applies to individuals or businesses who occasionally undertake taxable supply in a state where they don't have a fixed place of business.
- Example: A Delhi-based event management company organizes a wedding in Goa. As a casual taxable person making a supply in Goa, it is required to register for GST in Goa, even though it doesn't have a permanent office there. This registration is generally valid for a limited period (usually three months).
-
Reverse Charge Mechanism (RCM): If you are liable to pay GST under the reverse charge mechanism, you must register. This means you are the recipient of certain specified goods or services, and you are responsible for paying GST on those supplies instead of the supplier.
- Example: A company hiring a Goods Transport Agency (GTA) which has opted to not charge GST from their customers. The Company becomes responsible for paying the applicable GST under RCM. Therefore the Company must register for GST.
-
Section 9(5) Obligations: This refers to Electronic Commerce Operators (ECOs) who are liable to pay GST on specific services supplied through them, such as passenger transport and accommodation services. These ECOs must register, regardless of their turnover.
- Example: An online hotel aggregator is required to pay GST on behalf of the hotels listed on its platform for accommodation services. Therefore, the online hotel aggregator has to register for GST.
-
Non-Resident Taxable Person: If you are a person residing outside India but making taxable supplies within India, you must register for GST.
- Example: A foreign consultant providing advisory services to a company in India is required to register for GST.
-
Tax Deductors (TDS): Entities required to deduct Tax at Source (TDS) under Section 51 of the CGST Act must register, even if they are not otherwise required to register for GST. This applies to government agencies and certain specified entities.
-
Agents: Persons making taxable supplies of goods or services on behalf of other taxable persons (as an agent or otherwise) must register.
- Example: A commission agent facilitating the sale of agricultural produce on behalf of farmers is required to register for GST.
-
Input Service Distributor (ISD): An ISD, whether or not separately registered, must register. An ISD distributes input tax credit to its branches or units.
-
Suppliers through ECOs (collecting TCS): Persons supplying goods or services through an Electronic Commerce Operator (ECO) who is required to collect Tax at Source (TCS) under Section 52 must register, unless they are supplying services specified under Section 9(5).
- Example: A seller selling handmade crafts through a major e-commerce platform is required to register for GST, as the e-commerce platform is required to collect TCS on those sales.
-
Electronic Commerce Operators (ECOs): Every ECO required to collect TCS under Section 52 must register.
- Example: Amazon, Flipkart, and other similar platforms are required to register for GST as they collect TCS on behalf of their sellers.
-
Online Information and Database Access or Retrieval (OIDAR) Services: Persons supplying OIDAR services from outside India to unregistered persons in India must register.
- Example: A foreign company providing online software services to individuals in India who are not registered under GST must register for GST in India.
-
Online Money Gaming: As of the amendment in 2023, individuals or entities providing online money gaming services from outside India to individuals within India are required to register for GST, regardless of turnover.
-
Other Notified Persons: The government has the power to notify other categories of persons who are required to register compulsorily.
Amendments: It's important to note the insertion of clause (xia) in 2023, mandating registration for providers of online money gaming from outside India, and the removal of the old clause regarding composition scheme. These changes reflect the evolving nature of the GST law and the government's efforts to capture revenue from emerging sectors.
In conclusion, Section 24 is a critical provision in the CGST Act that mandates GST registration for specific categories of persons and businesses, irrespective of their turnover. Businesses must carefully evaluate whether they fall under any of these categories to ensure compliance with GST regulations.
No case laws found for this section yet.
Browse all case laws →Frequently Asked Questions
What types of businesses are required to register under CGST Section 24 regardless of their turnover?
CGST Section 24 lists several categories requiring compulsory registration. These include: (a) persons making any inter-State taxable supply; (b) casual taxable persons making taxable supply; (c) persons who are required to pay tax under reverse charge; (d) persons who are required to deduct tax under section 51; (e) persons who make taxable supply on behalf of other taxable persons whether as an agent or otherwise; (f) Input Service Distributor (ISD); (g) persons who supply goods or services, other than supplies specified under sub-section (5) of section 9, through such electronic commerce operator who is required to collect tax at source under section 52; (h) every electronic commerce operator who is required to collect tax at source under section 52; (i) every person supplying online information and database access or retrieval services from a place outside India to a person in India, other than a registered person; and (j) such other category of persons as may be notified by the Government.
If I am making only exempt supplies, am I still required to register under CGST Section 24?
While generally exempt supplies do not trigger GST registration, Section 24 has specific scenarios where even those dealing exclusively in exempt supplies might need registration. For example, if you are making inter-State supplies of exempt goods, you would be compulsorily required to register.
What does 'casual taxable person' mean in the context of compulsory registration under Section 24?
A 'casual taxable person' means a person who occasionally undertakes transactions involving supply of goods or services or both in a State or a Union territory where he has no fixed place of business.
If my aggregate turnover is below the threshold limit for GST registration, but I supply goods through an e-commerce operator (ECO) who is required to collect TCS, do I need to register under Section 24?
Yes, generally, if you are supplying goods or services (other than specified services under section 9(5)) through an ECO who is required to collect tax at source (TCS) under Section 52, you are required to register compulsorily under Section 24, regardless of your aggregate turnover. However, there are some notifications that have been issued providing exemptions from this rule for suppliers of goods making intra-state supplies through E-Commerce operators subject to certain conditions.
Are there any exceptions to the mandatory registration requirement under CGST Section 24?
Yes, an exception exists for persons making supplies specified under sub-section (5) of section 9 through an Electronic Commerce Operator (ECO). Sub-section (5) of section 9 deals with services such as passenger transport and accommodation services supplied through an ECO, where the ECO is liable to pay tax on behalf of the supplier.
What are the penalties for not registering under CGST Section 24 when required?
Failure to register when required under CGST Section 24 can attract penalties under the GST law. This can include penalties for not paying taxes, interest on delayed payments, and other consequences for non-compliance.
I am a supplier of OIDAR services from outside India to unregistered individuals in India. Do I need to register under CGST Section 24?
Yes, if you are supplying Online Information and Database Access or Retrieval (OIDAR) services from a place outside India to a person in India, other than a registered person, you are required to register compulsorily under CGST Section 24.
Key Conditions & Requirements
| Condition | Details |
|---|---|
| Inter-State taxable supply | Persons making any inter-State taxable supply are required to register, regardless of turnover. |
| Casual taxable person | Casual taxable persons making taxable supply must register. |
| Reverse Charge Mechanism (RCM) | Persons required to pay tax under reverse charge are required to register. |
| Section 9(5) RCM | Persons required to pay tax under sub-section (5) of section 9 (specified categories of services through e-commerce operators) must register. |
| Non-resident taxable person | Non-resident taxable persons making taxable supply must register. |
| Tax Deductor (TDS) | Persons required to deduct tax under section 51, whether or not separately registered, are liable for registration. |
| Supplies through E-commerce Operator (ECO) liable to TCS | Persons who supply goods or services or both, other than supplies specified under sub-section (5) of section 9, through an ECO who is required to collect tax at source under section 52 must register. |
| Online Money Gaming from Outside India | Every person supplying online money gaming from a place outside India to a person in India is required to register. |
No related notifications found for this section.
Browse all notifications →Amendment History
Inserted by s. 12 of The Central Goods and Services Tax (Amendment) Act, 2018 (No. 31 of 2018) - Brought into force w.e.f. 01st February, 2019.
Omitted by s. 3 of Central Goods and Services Tax (Amendment) Act, 2023 (No. 30 of 2023) - Brought into force w.e.f. 01st October, 2023 vide Notification No. 48/2023-C.T. , dated 29nd Sep, 2023.
Inserted by s. 3 of Central Goods and Services Tax (Amendment) Act, 2023 (No. 30 of 2023) - Brought into force w.e.f. 01st October, 2023 vide Notification No. 48/2023-C.T. , dated 29nd Sep, 2023.