Section 11: Cancellation of Registration

1) The tax officer shall Cancellation of registration of a registered person if:

(a) In the case of a body corporate, if the body corporate is closed down, sold or transferred or if the body corporate otherwise ceases to exist;

(b) In the case of an individual ownership, if the owner dies;

(c) In the case of a partnership firm, if it is dissolved;

(d) That person ceases to carry on taxable transactions,

(e) That person is a taxpayer who submits zero return for twelve consecutive years or has failed to submit any return at all,

(f) That person is a taxpayer whose taxable transaction is less than five million rupees in the case of goods and two million rupees in the case of mixed transaction of goods and services or of services in the last twelve months,

(g) That person has been registered mistakenly.

2) Notwithstanding anything contained in clause (f) of sub-section (1), if the taxpayer registered voluntarily pursuant to Section 9 so intends and makes an application, accompanied by the final return of the last twelve months, in the prescribed format, the registration of such a taxpayer shall be maintained.

3) The taxpayer shall submit the documents for tax examination within fifteen days of the submission of the tax return for the cancellation of registration, and the tax officer shall, within three months, cancel such registration after tax examination of the taxpayer or inform the taxpayer if the registration is not liable to cancellation. The taxpayer need not submit the tax return after that period if the tax officer fails to cancel the registration or make a decision on its cancellation within that period.

4) Stock of the goods, including capital goods, available at the time of the cancellation of registration on which tax deduction facility has already been taken, tax shall be assessed and recovered as if the stock were supplied at the market value.

Explanation: For the purposes of this sub-section, “capital goods” means any property or any part of the property and the property to be used in a taxable transaction.

5) In the case of a taxpayer who has any act and obligation due to be performed under this Act as a result of the commission or omission of anything in the course of transaction of taxable goods or services, the cancellation of the registration of such a taxpayer shall not exempt him or her from such obligation.

6) The other procedures on the cancellation of registration shall be as prescribed.