To apply for deregistration of your wholesale business from sales tax, you will follow a prescribed procedure outlined in the Sales Tax Rules, 2006, primarily utilizing the computerized system and specific forms. Here's a breakdown of the process:
Application for Deregistration:
- As a registered person who is ceasing to carry on your business, you should apply online on the computerized system for cancellation of your registration.
- The specific form for this application is Form STR-3, titled "Taxpayer De-Registration Form". This form includes options for reasons such as "Ceased to carry on business".
Processing of Application:
- The Commissioner has the authority to issue an order of deregistration or cancellation of registration.
- This order is typically issued within sixty days from the date of your online application or the date all your outstanding sales tax dues are deposited, whichever is later.
- Once your application is submitted on the computerized system, your obligation to file monthly sales tax returns under section 26 of the Sales Tax Act, 1990, will be suspended until your deregistration is finalized or your application is rejected.
Audit and Finalization:
- The Commissioner may decide to conduct an audit or inquiry to determine your sales tax liability. If so, you will be required to provide the necessary records in writing.
- These proceedings are to be completed within ninety days from the date of your application, assuming all required records are provided and the audit/inquiry is finished.
- You will be directed to discharge any outstanding liabilities by filing a final return under section 28 of the Sales Tax Act, 1990. This final return must be submitted in the specified form, manner, and within the time directed by the Commissioner.
- Upon the submission of your final return and any due payments, an entry will be made in the computerized system, which will automatically de-register you after ninety days.
Implications During Deregistration Process:
- During the period of deregistration, you will be barred from filing Annex-C, Annex-D, and the regular sales tax return.
- No input tax adjustment or refund will be admissible to you as the registered person, nor will other registered persons be allowed input tax adjustment or refunds based on invoices you issued during this period.
Continued Obligations:
- It is crucial to note that your obligations and liabilities related to the period when you operated as a registered person are not affected by the cancellation of your registration. This means any past dues can still be recovered.
