TMI BlogComposition Scheme in GSTX X X X Extracts X X X X X X X X Extracts X X X X ..... nual Return Quarterly payment of tax 3. Disadvantage of Composition scheme A limited territory of business, as the dealer is barred from carrying out inter-state transactions No input tax credit is available to composition dealers The taxpayer will not be eligible to supply non-taxable goods under GST such as alcohol and goods through an e-commerce portal. Threshold Limit and GST Rate Applicable in case of Composition Levy [ Section 10 of CGST Act ] Threshold Limit Section 10(1) Read with provisions of sub-sections (3) and (4) of section 9 , a registered person, whose aggregate turnover in the preceding financial year did not exceed 50 lakh rupees, may opt to pay, in lieu of the tax p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tory 3. Any other supplier eligible for composition levy under sub-sections (1) and (2) of section 10 half per cent. of the turnover of taxable supplies of goods and services in the State or Union territory Rate of tax composition levy for Services [ Section 10(2A) ] Sl. No. Category of registered persons Rate of tax but not exceeding 1 Registered persons not eligible under the composition levy under sub-sections (1) and (2), but eligible to opt to pay tax under sub-section (2A), of section 10 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Conditions and restrictions for composition levy [ Section 10(2) Read with Rule 5 of CGST Rules ] The registered person shall be eligible to opt if: (a) save as provided in section 10(1), he is not engaged in the supply of services; (b) he is not engaged in making any supply of goods or services which are not leviable to tax under this Act; [ in other words does not involve in supply of exempt category goods or services ] (c) he is not engaged in making any inter-State outward supplies of goods or services; (d) he is not engaged in making any supply of services through an electronic commerce operator who is required to collect tax at source under section 52 ; (e) he is not a manufacturer of such g ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued under the Income-tax Act, 1961), the registered person shall not be eligible to opt for the scheme under section 10(1) unless all such registered persons opt to pay tax under that sub-section. [ First proviso of Section 10(2) ] Other point to be considered The option availed of by a registered person under section 10(1) shall lapse with effect from the day on which his aggregate turnover during a financial year exceeds the limit specified under section 10(1). A taxable person to whom the provisions of section 10(1) apply shall not collect any tax from the recipient on supplies made by him nor shall he be entitled to any credit of input tax. If the proper officer has reasons to believe that a taxable person has pa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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