The government has proposed that the if returns not filed within the prescribed time, excise & service tax cancellation of registration will follow.

For manufacturers – Cancellation of registration will happen automatically if the excise duty returns not filed within 6 months.

For service providers – The registration shall be cancelled automatically if return is not filed for 12 months, said the draft of the common excise duty and service tax form on which the Revenue Department has sought comments from stakeholders by April 30.

Modes of cancellation

• On request of the assessee if he surrenders himself; or
• Suo motto by the department.

Cancellation on surrender by the assessee – The assesse can at any time surrender for cancellation of its registration on its own.

Cancellation by the department suo motto –

i. For the offences committed under the Central Excise Act, 1944, proper action should be taken against the registrant for the offences committed.

ii. Cancellation shall be done only on non- filing of return on time prescribed as above.

iii. The registrant shall be granted proper notice before cancellation by the department indicating the grounds for cancellation and also allowing him the opportunity to make representation against the said notice and following the principles of natural justice cancel the registration granted.

iv. The cancellation will not debar the person from making any fresh application for registration when he wishes to restart the business.

Publish the cancellation

The fact about the cancellation of registration shall be published publically so as to avoid any misuse of the cancelled registration.

Proposal in the Budget

Finance Minister had said that as a measure of harmonization between central excise and service tax, a number of alignments have been made.

“These include a common simplified registration form and a common return for central excise and service tax, to be named EST-1,” he said.

The excise duty return is filed on monthly basis, while service tax return is filed on half yearly basis.