Most businesses assume that GST registration becomes necessary only when their turnover crosses ₹40 lakh, ₹20 lakh, or ₹10 lakh. While this is generally true for regular suppliers, there’s another major provision that completely overrides these limits — Section 24 of the CGST Act.
Section 24 lists specific categories of suppliers who must register under GST even if their turnover is zero or extremely small. These persons do not get the benefit of threshold limits, meaning they are liable to register from Day 1 of starting their business activities.
In this blog, we’ll break down each category under Section 24, explain the logic behind mandatory registration, and give real-world examples so you can clearly understand when GST registration becomes compulsory.
What Is Section 24 of GST?
Section 24 states:
“Notwithstanding anything contained in Section 22(Threshold limits), the following persons shall be required to be registered under GST.”
This means—
- Threshold limits do not apply
- Registration becomes mandatory instantly
- Even ₹1 of taxable activity can trigger registration
- Even a future intention to supply can require registration
This section mainly covers activities where the government wants strict tax monitoring.
Who Must Register Under GST According to Section 24?
Below is the complete list of persons who must register irrespective of turnover:
1. Inter-State Suppliers of Goods
Earlier, every supplier making inter-state supply of goods had to register under GST regardless of turnover.
However, the rule has been relaxed for small suppliers, except for:
- Ice cream
- Pan masala
- Tobacco
If you supply these items inter-state, registration is mandatory.
Example:
A Jaipur seller sends pan masala to Delhi worth only ₹5,000.
- GST registration is compulsory.
2. Casual Taxable Persons (CTP)
A person who does occasional business in a State/UT where he does not have a fixed business place.
Examples:
- Exhibitions
- Trade fairs
- Pop-up shops
- Festival stalls
CTPs must register before starting business, and they must pay advance tax.
3. Non-Resident Taxable Persons (NRTP)
Foreign suppliers supplying goods or services in India must register before starting business.
Example: A company in Dubai displaying electronics in India for an expo.
- Mandatory registration.
4. Persons Required to Pay Tax under Reverse Charge (RCM)
Anyone who is liable to pay GST by reverse charge must register even if their turnover is zero.
Common RCM categories:
- Goods Transport Agency (GTA)
- Legal services
- Sponsorship services
- Import of services
Example:
A firm with ₹0 sales hires a lawyer.
- Must register and pay GST under RCM.
5. Persons Making Taxable Supplies on Behalf of Others (Agents)
Commission agents, brokers, and consignment agents must register.
Example: A textile agent selling on behalf of multiple merchants.
- Mandatory registration.
6. Input Service Distributors (ISD)
A head office distributing input tax credit to branches must register as an ISD.
Example: A corporate office paying advertising GST on behalf of branches.
- Must get ISD registration.
7. E-Commerce Operators (ECO)
Platforms like:
- Amazon
- Flipkart
- Meesho
- Swiggy
- Zomato
- Ola / Uber
They must register regardless of turnover because they collect tax at source (TCS).
8. Persons Supplying Through E-Commerce Operators
If you sell goods or services through an e-commerce operator, registration is mandatory unless exempted.
For Goods:
Small sellers can sell on e-commerce without registration under new rules IF:
- supply is intra-state
- turnover is below threshold
For Services:
Service providers must register irrespective of turnover.
Example: A beautician offering home services via UrbanClap with ₹1 lakh annual income.
- Must register.
9. Persons Required to Deduct Tax (TDS)
Government departments and notified bodies deduct TDS under GST and must register compulsorily.
10. Persons Required to Collect Tax (TCS)
E-commerce operators collecting TCS under GST must register.
11. Online Information and Database Access or Retrieval Services (OIDAR)
Foreign service providers offering digital services to Indian consumers must register. This includes:
- Netflix
- Spotify
- Adobe
- Google services
12. Supplier of Handicraft Goods (Inter-State)
Handicraft businesses supplying inter-state must register only if they cross ₹20 lakh (₹10 lakh in special states).
However, they were earlier required to register compulsorily.
13. Any Other Class of Persons Notified by Government
The government can add more categories to compulsory registration from time to time.
Why Section 24 Overrules Threshold Limits?
The goal of Section 24 is to ensure:
- strict tax monitoring
- track e-commerce transactions
- avoid revenue leakage
- prevent misuse of threshold benefits
- bring certain sectors under compulsory compliance
It ensures transparency especially in sectors with:
- high cash flow
- online transactions
- cross-border movements
- agency-based supplies
Examples for Better Understanding
Example 1: Inter-State Service Provider
A freelance content writer in Rajasthan provides services to a client in Maharashtra worth ₹10,000.
- Earlier: registration compulsory
- Now: exempt up to ₹20 lakh (₹10 lakh in special category states)
➡️ No mandatory registration unless turnover exceeds limit.
Example 2: E-Commerce Service Provider
A yoga instructor offering online classes through a platform like UrbanPro earns ₹80,000 a year.
➡️ Must register (Section 24).
Example 3: Reverse Charge
A businessman with ₹1 lakh turnover hires:
- a lawyer, or
- a GTA service
➡️ Must register under RCM.
Example 4: Casual Taxable Person
A Gujarat shop sets up a 5-day stall in Delhi for a festival.
➡️ Must apply for temporary GST registration.
What Happens If You Don’t Register Under Section 24?
Penalties include:
- 10% of tax due or ₹10,000 (minimum)
- Interest on unpaid tax
- Blocking of e-way bills
- Confiscation of goods
- Cancellation of business operations
If the government finds you liable under Section 24, you may also face:
- retrospective registration
- retrospective tax demand
- retrospective penalties
Common Misconceptions About Section 24
Myth 1: “I’m a small seller, so I am exempt.”
If you fall under Section 24, you are NOT exempt.
Myth 2: “E-commerce operators register me automatically.”
No. You need your own GST registration.
Myth 3: “Reverse charge applies only to big businesses.”
Wrong. Even individuals may need registration under RCM.
Myth 4: “Casual taxable persons can avoid registration for small events.”
CTPs must register before supply.
⭐ Conclusion
Section 24 is one of the most important parts of GST law. It clearly identifies categories where registration is mandatory, even when turnover is zero. If your business falls under any compulsory category—whether it’s e-commerce, RCM, agency business, OIDAR, or inter-state supplies—GST registration cannot be avoided.
Understanding Section 24 helps you stay compliant, avoid penalties, and operate your business legally.
FAQs
1. What is Section 24 of GST?
Section 24 lists persons who must register under GST regardless of turnover.
2. Do threshold limits apply to Section 24 cases?
No. Section 24 overrides all threshold limits.
3. Who must register under Section 24?
E-commerce operators, agents, RCM recipients, CTP, NRTP, ISD, OIDAR providers, TDS/TCS deductors, etc.
4. Do small e-commerce sellers need registration?
Goods sellers may get exemption, but service sellers must register.
5. Do freelancers providing inter-state services need registration?
Not anymore, up to ₹20 lakh/₹10 lakh turnover. They are exempt unless crossing threshold.
6. Does hiring a lawyer create compulsory registration?
Yes. RCM liability makes GST registration mandatory.
7. Can a casual taxable person supply without registration?
No. CTPs must register before supplying goods or services.
