Introduction:

Section 23 of the GST act deals with the provision related to the persons not liable to registration under GST. GST registration is the process of enrolling your business under the Goods and Services Tax system in the GST portal. It’s mandatory for businesses that meet certain criteria, mainly  based on their turnover. However, there are certain cases where person who are not mandatory required to get registered.

Section 1: Persons not liable to registration under GST act

Section 23 lists the persons not liable to registration. Thus, the persons so listed will not be the taxable persons. They are namely,

1) Person engaged exclusively in the business of supplying goods and / or services not liable to tax/ wholly exempt from tax – As per section 23 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 CGST Act/ ICGST Act shall not be liable to registration.

2) An Agriculturist, to the extent of supply of produce out of cultivation of land are the persons not liable to registration under GST

3) Specified category of persons notified by the government exempted from obtaining registration –  Following category of persons have been notified as being exempted from obtaining registration under the GST law.

1. Persons making only reverse charge – Persons who are only engaged in making supplies of taxable goods or services or both, the total tax on which is liable to be paid on reverse charge basis by the recipient of such goods or services or both under section 9(3) have been exempted from obtaining registration ( Notification no.5/2017 CT dated 19/06/2017 )
2. Persons making inter-state supplies of taxable services up to 20 laksh – The persons making inter-state supplies of taxable services and having an aggregate turnover, to be computed on all India basis, not exceeding an amount of Rs.20 laksh in a financial year have been exempted from obtaining compulsory registration. However, the aggregate value of such supplies, computed on all India basis, should not exceed an amount of Rs.10 lakh in case of Special category states of Mizoram, Tripura, Manipur and Nagaland Are those persons not liable to registration under GST. ( Notification no.10/2017 IT dated 13/10/2017 )    
3. Persons making inter-State  taxable supplies of notified handicraft goods up to Rs. 20 lakh –  Ap erson making inter-State supplies of goods is liable to be registered compulsorily under the GST irrespective of the threshold limit. However, in case of persons making inter-State taxable supplies of Notified handicraft goods are the persons not liable to registration under GST.  (Notification No. 3/2018 IT dated 22/10/2018)
4. Casual Taxable persons making Inter-State taxable supplies of Notified handicraft goods up to Rs.20 lakh. Are those persons not liable to registration under GST act.

Conclusion:

Section 23 of the GST act provides relief to Persons not liable to registration under GST act, which we have discussed in this article. Knowing the provision for who are required registration and who can get exemption from registration GST may helpful for the small business owners to carry on their business without much focusing on the GST compliance.

Disclaimer: The content and views stated in this article is solely for informational purpose only.

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