Compulsory GST registration for casual taxable person

Before discussing the provisions of mandatory GST registration in this case, it is important to first understand the meaning of “Casual Taxable Person”. The definition of “Casual Taxable Person” is given in clause (20) to section 2 of CGST Act as below:

Casual Taxable Person means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a state or a union territory where he has no fixed place of business.

There is category of certain taxable person who supplies taxable goods or services occasionally in a state or Union Territory but they don’t have a fixed place of business. The reason for this might be seasonal or temporary nature of business or any other reason. For example: Businesses take part in business exhibitions/ trade fairs in other states where they sell goods along with display in the exhibition. To meet the unique requirements of casual taxable person, special registration provisions have been prescribed for them in the GST law.

Following points are to be noted in respect of casual taxable persons:

A casual taxable person making taxable supply in a state/ union territory is required to obtain GST registration compulsorily as per clause (ii) to section 24 of CGST Act.
Threshold turnover limit as prescribed in section 22 of the CGST Act is not applicable in case of casual taxable person. It means that a casual taxable person is mandated to register under GST even on a nominal turnover.
A casual taxable person cannot opt to pay tax under composition scheme. Thus, he has to pay GST as a regular taxpayer.
He has to apply for GST registration at least 5 days prior to commencing his business and obtain a Temporary Registration Number which is valid for a maximum period of 90 days in the state/ union territory from where he seeks to apply as a casual taxable person.
A casual taxable person is required to make the advance deposit of GST, based on an estimation of tax liability [Read Rule 8(6) of CGST Rules]

Exemption from compulsory registration in case of casual taxable person

A Casual Taxable Person who is making inter-state taxable supplies of handicraft goods need to register only if their aggregate annual turnover crosses INR 20 Lakhs/ 10 Lakhs (special category states). (Notification No. 56/2018- Central Tax dated 23.10.2018).

Such a person shall be required to obtain a Permanent Account Number (PAN) and generate e-way bill in accordance with the provisions of Rule 138 of the CGST Rules.

GST Returns to be furnished by a Casual Taxable Person

The casual taxable person is required to furnish the following returns:

FORM	DUE DATE OF FILING
FORM GSTR-1 (Details of outward supplies of goods or services)	On or before the 11^th of the following month
FORM GSTR-3B (Summary of ITC, purchases and tax liability)	On or before the 20^th of the following month

Note:

If a casual taxable person has opted for the QRMP scheme, he has to file IFF/GSTR-1 and GSTR-3B on a quarterly basis.
A casual taxable person is not required to file an annual return as required by a normally registered taxpayer.

Refund by a casual taxable person

The casual taxable person is eligible for the refund of any balance of the advance tax deposited by him after adjusting his tax liability.
The balance advance tax deposited can be refunded only after all the returns have been furnished, in respect of the entire period for which the certificate of registration was granted to him.
The refund relating to the balance in the electronic cash ledger has to be made in serial no. 14 of the FORM GSTR-3 return required to be furnished by him (instead of FORM GST RFD-01).

FREQUENTLY ASKED QUESTIONS

What is the registration process for casual taxable person?

A casual taxable person has to apply for registration at least 5 days prior to the commencement of business. Please note that there is no special form to register as a casual taxable person.
The normal FORM GST REG-01 which is used by other taxable persons can be used for obtaining registration by casual taxable person also.
A casual taxable person, before applying for registration, shall declare his PAN, mobile number, email address, State or Union Territory in Part A of FORM GST REG-01 on the common portal (GST portal).
The PAN shall be validated online by the common portal from the database maintained by the CBDT. The mobile number and email shall be verified through OTP.
On successful validation, a temporary reference number shall be generated and communicated to the applicant on the said mobile number and email address.
Using this reference number generated, the applicant shall electronically submit an application in Part B of FORM GST REG-01, duly signed or verified through electronic verification code, along with the documents specified in the said Form at the common portal, either directly or through a Facilitation Centre notified by the Commissioner.
The applicant will be given a temporary reference number by the Common Portal for making the mandatory advance deposit of tax for an amount equivalent to the estimated tax liability of such person for the period for which the registration is sought.
The registration certificate shall be issued electronically only after the said deposit appears in his electronic cash ledger. On depositing the amount, an acknowledgement shall be issued electronically to the applicant in FORM GST REG-02.

What is the validity period of registration for a casual taxable person?

The Certificate of registration shall be valid for the period specified in the application for registration or 90 days from the effective date of registration, whichever is earlier.
The casual taxable person can make taxable supplies only after the issuance of certificate of registration.

Can GST registration of a casual taxable person be extended?

In case the casual taxable person intends to extend the period of registration indicated in his application of registration, an application in FORM GST REG-11 shall be submitted electronically through Common Portal (GST Portal).
Such application shall be made before the end of the validity of registration granted ti him.
The validity period of 90 days can be extended by a Casual Taxable Person for further period not exceeding 90 days.
The extension will be allowed only on payment of the amount of an additional amount of tax equivalent to the estimated tax liability for the period for which the extension is sought.

What are the circumstances when GST registration needs to be obtained as a normal taxable person instead of a Casual Taxable Person?

In this regard, circular no. 71/45/2018-GST dated 26^th October 2018 has provided the following clarification:

In case of long running exhibition i.e. for a period of more than 180 days, the taxable person cannot be treated as a Casual Taxable Person.
Hence, the person should obtain registration under GST as a normal taxable person.
At the time of registration as a normal taxable person, the person should furnish a copy of allotment letter (granting him permission to use of the premises for exhibition). Accordingly, such an allotment letter will be treated as a proper document for ‘proof of place of business’.
In this case, the person is not required to pay any advance tax for the purpose of GST registration.
Post completion of the exhibition, the person should surrender the registration.

Disclaimer: The above article is meant only for educational purposes. Taxwink is not responsible for any loss or damage caused to any person on the basis of use of the above information. Readers are requested to consult a professional before placing any reliance on the above article. For any assistance please mail at: admin@taxwink.com

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