Provisions Related to Casual Taxable Person and Non Resident Person

The Goods and Services Tax (GST) framework in India, recognizes specific types of registrants who may not operate from a fixed place of business but still engage in taxable supplies. Two such categories are:

• Casual Taxable Person (CTP)

• Non-Resident Taxable Person (NRTP)

Casual and non-resident taxable persons are special categories under GST designed to regulate temporary or foreign suppliers conducting business in India.

The provisions related to Casual Taxable Persons and Non-Resident Taxable Persons under GST aim to bring occasional and short-term business activities into the tax net. While compliance requirements are stringent, these provisions ensure fair taxation without discrimination between permanent and temporary entities. Brief of such provisions are as follows-

Definitions

• Casual taxable person- As per section 2(20) of CGST Act, "casual taxable person" means a person who occasionally undertakes transactions involving supply of goods or services or both in the course or furtherance of business, whether as principal, agent or in any other capacity, in a State or a Union territory where he has no fixed Place of business;

• Non-resident taxable person- As per section 2(77) of CGST Act, "non-resident taxable person" means any person who occasionally undertakes transactions involving supply of goods or services or both, whether as principal or agent or in any other capacity, but who has no fixed Place of business or residence in India;

Registration Requirements

• Compulsory Registration – Section 24 of CGST Act

As per section 24(ii) & (v) of CGST Act, Both Casual Taxable Person and Non Registered Taxable Person are mandatorily required to register under GST regardless of turnover, before commencing business.

• Special registration provisions- As per Section 27 of CGST Act, the certificate of registration issued to a casual Taxable person or a nonresident Taxable person shall be valid for the period specified in the application for registration or ninety days from the effective date of registration, whichever is earlier and such person shall make taxable supplies only after the issuance of the certificate of registration.

Provided that the Proper officer may, on sufficient cause being shown by the said Taxable person, extend the said period of ninety days by a further period not exceeding ninety days.

In view of above, Registration is valid for 90 days from the effective date. It can be extended once by the proper officer for a further period not exceeding 90 days. Thus, maximum 180 days validity is allowed.

• Casual taxable person/nonresident person shall apply for registration at least 5 days prior to the commencement of business- As per first proviso to section 25 of CGST Act, a casual Taxable person or a non-resident Taxable person shall apply for registration at least five days prior to the commencement of business.

• Extension in period of operation by casual taxable person and non-resident taxable person – As per Rule 15 of CGST Rules, where a registered casual Taxable person or a non-resident Taxable person intends to extend the period of registration indicated in his application of registration, an application in FORM GST REG-11 shall be submitted electronically through the Common portal, either directly or through a Facilitation Centre notified by the Commissioner, by such person before the end of the validity of registration granted to him.

Option to pay Composition scheme

• Casual taxable person cannot opt for composition u/s 10 – As per section 10(2)(f) of CGST Act, the registration person shall be eligible to opt under sub-section (1), if he is neither a casual Taxable person nor a non-resident Taxable person.

Refund provision

• Refund to Casual taxable person or non resident taxable person– Notwithstanding anything to the contrary contained in this section, the amount of advance tax deposited by a casual Taxable person or a non-resident Taxable person under sub-section (2) of Section 27, shall not be refunded unless such person has, in respect of the entire period for which the certificate of registration granted to him had remained in force, furnished all the returns required under section 39.

Advance Deposit of Tax

• Advance Deposit of Tax- As per Section 27(2) of CGST Act, a casual Taxable person or a non-resident Taxable person shall, at the time of submission of application for registration under sub-section (1) of section 25, make an advance deposit of tax in an amount equivalent to the estimated tax liability of such person for the period for which the registration is sought. Also refer Rule 8(6) of CGST Rules.

Returns to be Filed

• Exemption to file Annual Return- A casual Taxable person and a non-resident Taxable person are not required to file Annual return

Form and manner of submission of return by non-resident Taxable person- Every registered non-resident Taxable person shall furnish a return in FORM GSTR-5 including therein the details of outward supplies and inward supplies and shall pay the tax, interest, penalty, fees or any other amount payable under the Act within twenty days after the end of a tax period or within seven days after the last day of the validity period of registration, whichever is earlier.