Auto Cancellation of Excise, Service tax Registration for non filing of Returns

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Government Proposes Automatic Cancellation of Excise, Service tax Registration for non filing of Returns

Registration of a manufacturer will be cancelled automatically if excise duty returns are not filed for six months, as per the latest government proposal. In case of a service provider, the registration will be cancelled automatically if return is not filed for 12 months, said the draft of the common excise duty and service tax form on which the Revenue Department has sought comments from stakeholders by April 30. Cancellation of the registration can be done either on the request of assessee when he surrenders the registration or suo motto by the department after following the principles of natural justice. Before cancellation, the Proper Officer shall verify with regard to the pending dues and other pending matters against the assessees and take appropriate action. Thereafter the registration shall be cancelled. Cancellation in no way shall absolve the person from any of the legal liabilities created on him in the past.

Cancellation of the registration on surrender of registration: Registrant can at any time surrender his registration.

Cancellation of the registration suo motto by the department

i. The cancellation of registration is not punitive measure. For the offences committed under the Central Excise Act, 1944, or Chapter V of the Finance Act, 1994, proper action should be taken against the registrant for the offences committed under the relevant penal provisions in the Central Excise Act, 1944 or the Chapter V of the Finance Act, 1994.

ii. Cancellation of the registration shall be only on account of non-filing of the returns for a specified period that is:-

• 6 months for normal assessees and 12 months for assessees availing value based exemption for Central Excise registrants,

• 12 months for Service tax registrants.

iii. For the suo motto cancellation of the registration the proper officer shall issue a notice to the registrant indicating the grounds for cancellation. After allowing him the opportunity to make representation against the said notice and following the principles of natural justice cancel the registration granted.

iv. Since Cancellation is not punitive, it will not debar the person from making fresh application for registration when he desires to restart the business.

On cancellation of the registration, the fact about cancellation of the registration shall be published and put in public domain so as to avoid any misuse of the cancelled registration.