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Presentation by:
VISHAL SOMAI
Sr. faculty of Direct & Indirect tax
TOPIC
REFERENCE
Composition Levy - Statutory
Provisions
Presumptive Scheme for
Services Suppliers and Mixed
Suppliers
Composition Levy -
Procedural Requirements
COMPOSITION SCHEME
Optional Scheme
1. Arunachal Pradesh
2. Manipur
3. Meghalaya Upto Rs. 75 lakh
4. Mizoram
5. Nagaland
6. Sikkim
7. Tripura
8. Uttarakhand
9. Assam
Upto Rs. 1.5 crore
10. Himachal Pradesh
11. Jammu and Kashmir
Eligibility
Note :
In case of Assam, Himachal Pradesh and Jammu and Kashmir, the
turnover limit will be Rs. 1.5 crore.
Eligibility - If aggregate turnover is upto Rs. 1.5 crore/ Rs. 75 lakh in
preceding financial year [Section 10(1)]
However, the aggregate turnover in the preceding financial year shall be Rs.
75 lakh in the case of an eligible registered person, registered under Section
25 of the said Act, in any of the following States, namely:-
Special Category States
Arunachal Pradesh Manipur Meghalaya
Mizoram Nagaland Sikkim
Tripura Uttarakhand
Note : In case of Assam, Himachal Pradesh and Jammu and Kashmir, the turnover limit will be Rs.
1.5 crore.
• "Aggregate turnover" means 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 y 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. [Section 2(6)]
Scheme will be applicable for all goods
and restaurant services
(a) supplier of services other than those mentioned in point no. 4 above.
(b) supplier of goods which are not taxable under the CGST Act/SGST Act/UTGST Act;
(c) an inter-State supplier of goods;
(d) person supplying goods through an electronic commerce operator who is required to
collect tax at source under Section 52;
(e) manufacturer of certain notified goods;
Ineligible Manufacturers : The manufacturer of following goods will not be eligible to opt for
composition scheme:
S. No. Tariff item, subheading, Description
heading or Chapter
1. 2105 00 00 Ice cream and other edible ice, whether or not
containing cocoa
2. 2106 90 20 Pan masala
2A 22021010 Aerated Water [w.e.f. 1-10-2019]
3. 24 All goods, i.e. Tobacco and manufactured tobacco
substitutes
Example :
In the above scenario, the composition scheme would be applicable for all the 3
units. Taxable person will not be eligible to opt for composition scheme say for
sale of footwear and sale of mobiles and opt to pay taxes under the regular scheme
for Ready-made garments.
Option lapses if aggregate turnover exceeds
Rs. 1.5 crore/ Rs. 75 lakh [Section 10(3)]
If the proper officer has reasons to believe that a taxable person has paid tax
under composition scheme despite not being eligible, such person shall, in
addition to any tax that may be payable by him under any other provisions of
this Act, be liable to a penalty and the provisions of Section 73 or Section 74
shall be applicable for determination of tax and penalty.
State the clarifications made vide CGST (Removal of Difficulties Order),
2019 Order No. 01/2019-CT dated 01-02- 2019, ixt respect of Composition
scheme?