Compulsory GST Registration in Certain Cases – Section 24 of GST

The GST framework in India mandates registration for businesses exceeding a specified turnover threshold. However, under Section 24 of the CGST Act, certain categories of persons are required to register under GST, irrespective of their turnover. Understanding these provisions is crucial for businesses to ensure compliance and avoid penalties.

Who Must Register Under Section 24?

Section 24 overrides the basic exemption limit under Section 22 of the CGST Act and mandates compulsory registration for the following persons:

1. Persons Making Inter-State Taxable Supplies

Businesses involved in the supply of goods or services across state borders must obtain GST registration, irrespective of their turnover.

2. Casual Taxable Persons (CTP)

A casual taxable person (CTP) temporarily supplying goods or services in a taxable territory must register under GST, even if their turnover is below the threshold limit.

3. Persons Liable to Pay Tax Under Reverse Charge

Businesses or individuals required to pay tax under the reverse charge mechanism (RCM) must register under GST. This typically applies when the recipient, rather than the supplier, is liable to pay GST.

4. Persons Liable to Pay Tax Under Section 9(5)

Section 9(5) covers specific services where tax liability is shifted to e-commerce operators instead of the actual supplier. Examples include cab aggregators, housekeeping services, and online food delivery services.

5. Non-Resident Taxable Persons (NRTP)

Foreign businesses supplying goods or services in India without a fixed place of business must register under GST.

6. Persons Required to Deduct Tax Under Section 51

Certain government bodies and notified entities must deduct tax at source (TDS) under Section 51 and register under GST.

7. Agents Making Taxable Supplies on Behalf of Other Taxable Persons

Individuals or entities making taxable supplies as agents of registered persons must also obtain GST registration.

8. Input Service Distributors (ISD)

Businesses distributing input tax credit (ITC) across multiple units must register under GST as an Input Service Distributor (ISD).

9. Persons Supplying Through E-Commerce Operators

Suppliers selling goods or services through e-commerce platforms (such as Amazon, Flipkart, or Zomato) must register under GST, except those supplying exempt goods or services.

10. E-Commerce Operators Collecting Tax at Source (TCS) Under Section 52

Every e-commerce operator required to collect tax at source (TCS) must register under GST, regardless of turnover.

11. Persons Supplying Online Information and Database Access (OIDAR) Services

Foreign companies providing online information, database access, or retrieval (OIDAR) services to unregistered persons in India must obtain GST registration.

12. Persons Supplying Online Money Gaming Services from Outside India (Inserted via 2023 Amendment)

From October 1, 2023, foreign businesses providing online money gaming services to users in India are also required to register under GST.

13. Any Other Notified Persons

The government may notify additional categories of persons for compulsory registration based on recommendations of the GST Council.

Important Amendments to Section 24

• February 1, 2019: Amendment introduced to mandate e-commerce operators to register under GST.

• October 1, 2023: Introduction of online money gaming suppliers in the mandatory registration list.

• October 1, 2023: Certain provisions related to OIDAR services were amended.

Conclusion

Understanding the provisions of Section 24 of the CGST Act is crucial for businesses to avoid non-compliance and penalties. Even if turnover does not exceed the standard GST threshold, certain categories must register mandatorily. It is advisable for businesses to assess their GST registration obligations and seek professional guidance if necessary.

For expert assistance with GST registration and compliance, contact us today at +91 9769647582!