Registration required in case of liability under RCM, even if no taxable supplies effected

The Authority of Advance Ruling (AAR), West Bengal in the case of Joint Plant Committee [2018] 92 taxmann.com 208 (AAR-West Bengal), has held that, in case applicant is engaged exclusively in supplying goods or services which are wholly exempted from tax, is not liable to get registered under the provisions of Section 23(1) of the CGST Act, 2017. This is subject to the condition that the applicant is not otherwise liable to pay tax under the reverse charge mechanism in accordance with the GST Law.

In this case, the applicant is engaged exclusively in supplying the goods and services that are wholly exempted from payment of tax, and therefore not liable to get registered in accordance with the provisions under section 23(1) of the GST Act. However, the question arises that whether there is a requirement for registration under section 24, even if it is not making any taxable supply.

According to section 24 of the GST Act, 2017, every person is required to get registration under certain circumstances even if his aggregate turnover does not exceed the threshold limit specified under Section 22(1) of the Act (i.e Rs. 20 lakhs). Further, the provisions of Section 24 is not subject to the provisions of Section 23 of the GST Act. Therefore, if a person is not liable to be registered for making exclusively exempt supplies, but is liable to pay tax under Reverse Charges under Section 9(3) of the GST Act or 5(3) of the IGST Act, then he shall be required to get himself registered under the GST Act, irrespective of the quantum of the aggregate turnover.