# Section 22 — Registration based on Aggregate Turnover

Every supplier becomes liable to obtain registration when his Aggregate Turnover (AT) exceeds the prescribed limit in a financial year — in the State/UT from where he makes taxable supplies.

## (1) Aggregate Turnover — Definition

Turnover computed on All-India basis of all persons having the same PAN.

### What is INCLUDED in aggregate turnover

Taxable supplies
Exempt supplies
Exports and inter-state supplies
Taxes other than GST (e.g., excise on tobacco, basic customs duty)
Outward supplies under RCM
Supplies between distinct persons (same PAN, different states)
Supplies of goods made by agent on behalf of principal, if invoice is issued in agent's own name (included in agent's turnover)

### What is EXCLUDED

Inward supplies on which tax is paid under RCM
All GST taxes themselves (CGST/SGST/UTGST/IGST + cess)

### Special carve-out

Supplies between Principal Place of Business (PPoB) and Additional Place of Business (APoB) in the same registration are NOT supplies → not included in AT.

## (2) Specified Threshold Limits (State-wise)

Category	States/UTs	Limit (Only Goods)	Limit (Otherwise)
MAINTAIN	Manipur, Mizoram, Nagaland, Tripura	₹10 lacs	₹10 lacs
STUMP-Arun	Sikkim, Telangana, Uttarakhand, Meghalaya, Puducherry, Arunachal Pradesh	₹20 lacs	₹20 lacs
HAJ + Others	Himachal Pradesh, Assam, J&K, and other states	₹40 lacs	₹20 lacs

### Key clarifications

(i) "Supply of only goods" — A person is still considered as making only goods supply even if he is earning interest/discount on loans, deposits, advances (these are exempt financial services but don't disqualify him from the 40-lac limit).

(ii) 40-lac limit NOT available if:

Person is required to take compulsory registration u/s 24, OR
Person supplies any of the following items (then only 10/20 lac limit applies):
Ice cream and other edible ice
Pan masala, Tobacco and its substitutes
Fly ash bricks, aggregates, blocks; Earthen and roofing tiles
Building bricks; fossil meal bricks / similar siliceous earth bricks

(iii) Multi-state operations: If a person operates in more than one State/UT, apply the lowest applicable limit among those states.

> But: States/UTs from where only exclusively exempt supplies are made → IGNORED while determining the lowest limit.

(iv) Registration is required only in those States/UTs from where taxable supplies are made (not exempt-only states).

(v) Business transfer / amalgamation / merger: The transferee must register from the date of certificate of incorporation issued by the RoC.

Worked example

### Example 1

Example — Determining limit & registration requirement

ABC Ltd. operates:

Furniture showroom at Delhi → turnover ₹7 lacs
Furniture showroom at Sikkim → turnover ₹9 lacs
Liquor shop at Manipur → turnover ₹6 lacs (liquor is non-taxable supply)

Aggregate Turnover (All-India, same PAN) = ₹7 + ₹9 + ₹6 = ₹22 lacs

Determining applicable limit: Compare states where taxable supplies are made:

Delhi (only goods, 'other' state) → ₹40 lacs
Sikkim (STUMP-Arun) → ₹20 lacs
Manipur → IGNORED (only exempt/non-taxable supply of liquor)

Lowest limit = ₹20 lacs (Sikkim).

Conclusion: AT (₹22 lacs) > ₹20 lacs → Registration required. Register in Delhi and Sikkim (states from where taxable supplies are made), NOT in Manipur.

### Example 2

Example — 40-lac limit denied due to product

Mr. X sells only goods from Gujarat. His turnover is ₹35 lacs. If he sells furniture → limit = ₹40 lacs → No registration needed. If he sells pan masala → limit drops to ₹20 lacs → Registration required.

### Example 3

Example — Interest income & 'only goods' status

Mr. Y sells goods worth ₹38 lacs and earns ₹2 lacs as interest on FD (exempt supply of service). Is he 'supplying only goods'? Yes — interest/discount on deposits doesn't disqualify the only-goods status. ₹40 lac limit applies. Registration not required.

⚠️ Common exam mistakes

Including GST taxes in aggregate turnover — these are excluded.
Including inward RCM supplies — only outward RCM supplies are included.
Forgetting to add exempt supplies and exports to aggregate turnover.
Using the highest state limit instead of the LOWEST applicable limit when operating in multiple states.
Considering states where only exempt supplies are made while picking the lowest limit — these must be ignored.
Applying the ₹40-lac limit to a person who deals in ice cream, tobacco, or specified bricks — they are restricted to ₹20 lac (or ₹10 lac in special-category states).
Computing turnover state-wise instead of on a PAN-India basis.
Treating PPoB ↔ APoB transfers as supplies includible in AT — they are excluded.

Bare-Act text Section 22 read with Section 2(6) · CGST Act, 2017 · click to expand

Section 22(1) of the CGST Act, 2017: Every supplier shall be liable to be registered under this Act in the State or Union territory, other than special category States, from where he makes a taxable supply of goods or services or both, if his aggregate turnover in a financial year exceeds twenty lakh rupees. Section 2(6) defines 'aggregate turnover' as the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis), exempt supplies, exports of goods or services or both and inter-State supplies of persons having the same Permanent Account Number, to be computed on all-India basis but excludes central tax, State tax, Union territory tax, integrated tax and cess.

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Person Liable for Registration based on Aggregate Turnover [Section 22]

Worked example

⚠️ Common exam mistakes