Registration under GST — Procedure & Advantages — Law of Taxation Notes

Registration under GST — Procedure & Advantages

A trader cannot legally collect GST, or claim input tax credit, until he has a GSTIN — a 15-digit registration number. Registration is the gateway into the GST system: without it you are outside the credit chain and, above the threshold, actually breaking the law.

Who must register, how, and why

Who must register (ss.22–25 CGST):

Every supplier whose aggregate turnover in a financial year exceeds the threshold (broadly ₹40 lakh for goods / ₹20 lakh for services, with ₹20 lakh / ₹10 lakh for special-category States) must register in each State from which he supplies.
Compulsory registration (s.24) regardless of turnover for: inter-State suppliers of goods, casual taxable persons, persons liable under reverse charge, e-commerce operators and persons supplying through them, non-resident taxable persons, agents, and input service distributors.

Procedure (online, on the GSTN portal):

Apply in Form GST REG-01 on the common portal, giving PAN, mobile and email (verified by OTP), and business details.
PAN, mobile and email are validated; a temporary reference number is generated.
Upload documents (proof of business, bank, constitution, address).
The application is examined by the proper officer; if in order, registration is granted within the prescribed period and a GSTIN (a 15-digit PAN-based number) with a registration certificate (Form GST REG-06) is issued.
If deficient, a notice is issued and the applicant responds; deemed approval follows if the officer does not act in time.

Advantages of registration:

Legal recognition as a supplier of goods/services;
Right to collect GST from customers and pass on the credit;
Entitlement to input tax credit on purchases (the biggest benefit — an unregistered person cannot claim ITC);
Seamless inter-State trade and access to e-commerce platforms;
Competitive standing and eligibility for government tenders and refunds;
Avoidance of penalties for operating without registration above the threshold.

🧩 WORKED EXAMPLE — Is registration compulsory?

Facts. A trader in Karnataka with a turnover of only ₹8 lakh wants to sell goods to a buyer in Kerala (inter-State).

Rule. Under s.24, a person making an inter-State taxable supply of goods must register irrespective of turnover — the ₹40-lakh threshold does not save him.

Apply. Even though his turnover is well below the threshold, the inter-State supply triggers compulsory registration.

Conclusion. He must register before making the inter-State supply, obtain a GSTIN, and charge IGST — a common exam trap where students wrongly apply the threshold.

In Simple Terms: If your turnover crosses the threshold (about ₹40 lakh for goods, ₹20 lakh for services) — or you fall in a compulsory category like inter-State sellers or e-commerce — you must register online on the GST portal (Form REG-01) and get a 15-digit GSTIN. Registration lets you legally collect GST and, crucially, claim input tax credit.

flowchart TD
    ROOT["Registration under GST ss.22-25"]:::root
    ROOT --> W["WHO: turnover > threshold OR compulsory s.24<br/>(inter-State, e-commerce, RCM, casual, NRTP)"]:::leaf
    ROOT --> H["HOW: REG-01 online → PAN/OTP verify →<br/>docs → officer → GSTIN + REG-06"]:::leaf
    ROOT --> A["ADVANTAGES: legal status, collect GST,<br/>claim ITC, inter-State trade, tenders"]:::leaf
    classDef root fill:#FFF8DC,stroke:#000,stroke-width:1px,color:#000;
    classDef leaf fill:#E6F3FF,stroke:#1E3A8A,color:#000;
    linkStyle default stroke:#888,stroke-width:1px;

Case Laws

Bharti Airtel Ltd. v Union of India (2021) — on the GST return/portal mechanism and correction of returns, illustrating the portal-based compliance regime.

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