Section 22 of CGST Act, 2017 : Section 22: Persons Liable For Registration

Explanation using Example

Imagine a scenario where Mr. Sharma runs a handicraft business in the state of Uttar Pradesh. His business involves selling handcrafted items both within the state and inter-state. For the financial year 2022-2023, Mr. Sharma's total revenue from selling these items reaches ₹21 lakhs. According to Section 22(1) of the Central Goods and Services Tax Act, 2017, since his aggregate turnover exceeds the threshold of ₹20 lakhs, Mr. Sharma is required to register his business under the CGST Act. If Mr. Sharma's business was located in a special category state, say Sikkim, he would have to register only if his turnover exceeded ₹10 lakhs, unless the government, upon the state's request, notifies a higher threshold not exceeding ₹20 lakhs.

Additionally, if Mr. Sharma had acquired this handicraft business from another person as a going concern, as per Section 22(3), he would be liable to register the business under the CGST Act from the date of transfer. Should the business transfer occur as a result of a High Court-sanctioned amalgamation, as per Section 22(4), the new entity formed would have to register from the date the Registrar of Companies issues the certificate of incorporation post-amalgamation.