The GST came into effect from July 1, 2017 through the implementation of 101 Amendment of the Constitution of India by the Government of India. This tax regime replaced existing multiple cascading indirect taxes levied by the central and state governments and brings uniformity in tax rates and tax structure across states.
GST is introduced as an unified indirect tax only, leviable in India on the supply of goods or services or both except taxes on supply of the alcoholic liquor for human consumption.
GST is levied at every step in the production process, but is refunded to all parties in the chain of production other than the final consumer. Thus, GST is basically a destination based tax as levied at a single point at the time of consumption of goods or services by the ultimate consumer.
Central Goods and Service Tax – levied on all supplies of goods and/or services in the course of intra-state trade or commerce
State Goods and Service Tax – levied on all supplies of goods and/or services in the course of intra-state trade or commerce
Inter-State Goods and Service Tax – levied on all supplies of goods and/or services in the course of inter-state trade or commerce
At present, if any person / entity falls in the under mentioned exhaustive list of compulsory registration, the supplier has to get registered in such manner as prescribed:
Any business entity engaged in supply of goods whose aggregate turnover exceeds Rs. 40 lakh in normal category states and Rs. 20 lakh in special category states.
Any business entity engaged in supply of services whose aggregate turnover exceeds Rs. 20 lakh in normal category states and Rs. 10 lakh in special category states.
Special category states – Jammu & Kashmir and Assam opted for Rs. 40 lakh threshold for goods. Normal category state Puducherry opted for Rs. 20 lakh for goods.
Special category states: Arunachal Pradesh, Assam, J&K, Manipur, Meghalaya, Mizoram, Nagaland, Tripura, Sikkim and Uttarakhand
Under GST, small businesses — Only Manufacturers of goods, Dealers, and Restaurants (not serving alcohol) — with a turnover upto Rs 1.5 crore have been given the benefit of the Composition Scheme which gives them an option to lower tax rates.
This will brought down the tax and compliance burden on many small businesses.
| Type of Business | Manufacturer & Traders (Goods) | Restaurants (Not serving alcohol) |
|---|---|---|
| CGST | 0.5% | 2.5% |
| SGST | 0.5% | 2.5% |
| Total | 1.0% | 5% |
Composition Scheme – Applicable GST Rate
Every person who is liable to be registered has to apply for registration in relevant State (from where he makes a taxable supply of goods or services or both), within thirty days from the date on which he becomes liable to registration. Registration number in GST will be PAN based and therefore, having PAN would be a prerequisite for obtaining registration.
The assessee must obtain separate registration for each State if operates in multiple states, as registration under GST will be State-wise.
The assessee has also an option to obtain a separate registration for each of the 'business vertical' in the same State, if operates from multiple places in same state or can obtain single registration in One state for multiple place of business.
Application has to be made in FORM GSTREG-01 on the common portal of GST in the prescribed manner with prescribed details / documents.
The application and the accompanying documents shall be examined by the jurisdictional officer. If any further detail / documents are required, notice will be issued to the applicant electronically in FORM GST REG-03.
If the application is found to be in order, registration will be granted within three working days from the date of submission. If not in order, registration / rejection will be granted within seven working days from the date of receipt of clarification or documents in response to notice issued.
The application for grant of registration shall be deemed to have been approved — (1) If officer fails to take any action within 3 working days from the date of submission, or (2) If fails to take any action within seven working days from the date of receipt of clarification or documents in response to notice issued.
After approval granted / deemed approval, Registration Certificate is issued to the person in the prescribed manner duly mentioning the date of registration. From the said effective date, the said taxable person is bound to make all GST related compliances.
PAN Card of the entity
Latest Bank Statement or Cancelled Cheque of the entity
Certificate of Incorporation / LLP Agreement / Partnership Deed, if applicable
Proof of Address of premises with Utility Bill and Rent Agreement / NOC (if applicable)
KYCs including photographs of Directors / Partners / Proprietor
Details of goods / services traded
Valid Email ID and Phone Number
Digital Signatures of Authorized person in case of person other than Proprietor
Additional documents as may be applicable on case to case basis
