Section 23 states that Person who shall not be liable for registration

Section 23(1)(a)

Person who is engaged exclusively in the business of supplying goods or services or both

that are not liable to tax or wholly exempt from tax under this Act or under the IGST Tax Act

shall not be liable to registration.

Person who is only engaged in Exempt, Nil Rated or Non-GST supply, is not required to get registration under GST law.

Even if his aggregate turnover exceeds the threshold limit, he shall not be liable to be registered under this Act.

Ex

M/s HHI, is exclusively engaged in supplying petrol. Supply of petrol is not leviable to GST. Thus, M/s HHI is not liable for registration as it is engaged exclusively in supplying goods not leviable to tax.

Ex

HHI, a charitable trust registered u/s 12AA of the Income-tax Act, 1961, is exclusively engaged in supply of services by way of charitable activities. Services by an entity registered u/s 12AA of the Income-tax Act, 1961 by way of charitable activities are exempt from GST. HHI is not liable for registration as it is exclusively engaged in supplying services exempt from tax.

Question & Answer

It was opined that an applicant engaged exclusively in supplying goods and services that are wholly exempt from tax is not required to be registered under GST Act if he is not otherwise liable to pay tax under reverse charge under section 9(3) of GST Act or section 5(3) of IGST Act.

Section 23(1)(b)

an agriculturist, to the extent of supply of produce out of cultivation of land

shall not be liable to registration

Refer Section 2(7) for meaning of Agriculturist

Based on above definition, benefit of not being liable to registration is only restricted to the agriculturists who are individuals or HUFs.

Further, if an agriculturist is also engaged in making any supply other than supply of produce out of cultivation of land, he shall be liable to registration based on applicable threshold limit.

Ex

Mr X is an agriculturist engaged in cultivation of wheat in his field in the State of Punjab. He was exclusively engaged in supply of wheat cultivated in his field in the previous year. Thus, he was not liable to registration as he was exclusively engaged in supply of produce out of cultivation of land.

Ex

A, a farmer produces goods through cultivation from his own land and supplies the same to traders. The goods so supplied during the whole of the year aggregates to Rs 21 lacs. He is not liable to get the registration in terms of Section 23(1)(b) of the CGST Act.

Question & Answer

Section 23(2)

Govt. may by notifications, specify the category of persons who may be exempted from obtaining registration under this Act.

For list of notifications issued u/s 23(2), please refer above notification.