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On 22nd December 2018, the GST council held its 31st annual meeting where it announced through the press release that the effective date of applicability of amendments in GST Act(s) 2018 will be from 1st February 2019 wherein it made significant changes in many provisions of the CGST Act including in sections pertaining to registration. In the 32nd GST Council Meeting held on 10th January 2019 the threshold limit was also changed. When both the amendments are seen in conjunction to each other there have been significant changes been made overall (Relevant notification 56/2018, 65/2017, 10/2019, 05/2017, 32/2017).
Change in threshold limit
Before the amendment in GST, the threshold limit for registration under section 22 was INR 20 lakhs for states and union territories other than special category states. The threshold limit for the special category states was INR10 lakhs (which includes Arunachal Pradesh, Assam, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, Uttarakhand).
After the said amendment the threshold turnover for registration in special category States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand from ten lakh rupees to twenty lakh rupees. The threshold limit for sale of goods was also increased from INR 20 lakhs to INR 40 lakhs however; no change was made in the threshold limit of supply of services.
2nd proviso to section 22 was inserted wherein it was mentioned that the special category state can enhance the aggregate turnover referred to in the first proviso from INR10 lakhs to such amount, not exceeding INR 20 lakhs.
Special category states as per Constitution article 279A Arunachal Pradesh, Assam, Jammu & Kashmir, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim, Tripura, Himachal Pradesh, Uttarakhand.
In the Explanation, in clause (iii) of section 22 of the CGST Act, after the words “State of Jammu and Kashmir”, the words “and States of Arunachal Pradesh, Assam, Himachal Pradesh, Meghalaya, Sikkim and Uttarakhand” shall be inserted.” The effect of which was that the above mentioned states would not be able to choose the threshold limit of INR10 lakhs but due to the second proviso to sec 22 the special category states get to choose the threshold exemption.
The effect of the amendments was that Mizoram, Manipur, Tripura and Nagaland were the only 4 states having a threshold limit of INR 10 lakhs. Now, effectively there are now three category of registration which are follows :
Following table provides a summary of the above:
| States That Accepted INR 10 Lakhs | Normal States That Accepted INR 20 Lakhs | States That Accepted INR40 Lakhs Threshold Limit |
| 1. Manipur | 1. Arunachal Pradesh | Remaining 21 States and 5 Union Territories |
| 2. Mizoram | 2. Meghalaya | |
| 3. Nagaland | 3. Puducherry | |
| 4. Tripura | 4. Sikkim | |
| 5. Telangana | ||
| 6. Uttarakhand |
