All about composition scheme under goods and Services tax regime

2. RELEVANT SECTIONS AND RULES
 Section 10 read with section 9(3) and (4) of
CGST Act,2017
 Rule 3,4,5 &6 of the CGST Rules,2017

3.  Nothwithstanding anything to the contrary
contained in this act but subject to provision of
section 9(3) and (4) of the act. Any registered
person whose Aggregate turnover does not
exceed Rs. 75 lakh in preceding Financial year ,
may opt to pay tax at prescribed rates.

4.  The term Aggregate Turnover has been defined
U/s 2(6) of the act
“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 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;

5.  The provisions of Section 10 are subject to the
provisions of sub section (3) and (4) of section 9
of the act.
 Sub section (3) and (4) of section 9 provides for
the tax payable on Specified Supplies under
reverse charge mechanism by the recipient of
supplies.
 Hence, person opting for payment of tax under
section 10 is not exempt from payment of tax
under reverse charge mechanism

6.  Not engaged in Supply of services Except the
supplies referred in clause b Para 6 of schedule II
i.e. restaurant services.
 Not engaged in supply of goods which are non
taxable.
 Not engaged in making any interstate outward
supply of goods.
 Not engaged in making supplies through
electronic commerce where Tax collection at source
is required.
 Not engaged in manufacture of such goods as
notified by govt.

7.  Where there are more than one registered
person having same PAN,The registered
person shall not be eligible to opt for scheme
unless all such registered persons opt to pay
tax under the composition scheme under
section 10.
 The Option shall be lapsed from the date on
which aggregate turnover during financial year
exceeds the specified limit.

8.  The person to whom provisions of section 10
applies shall not collect tax from the recepient
on supplies made by him.
 Further person to whom Provisions of section
10 applies shall not be allowed to take any
input tax credit.

9. Rule 3-
1) Where a person who has been granted
Provisional Registration shall file an
intimation electronically in From GST CMP-1
before appointed date or within 30 days from
the appointed date and shall not collect tax
from the appointed date i.e. 1st july 2017.
2) Any person who applies for registration shall
be granted an option to opt Composition
Scheme while filling form GST Reg-1.

10. 3) Any registered Person who opts to pay tax under
this scheme shall file an intimation in form GST
CMP-2 Prior top commencement of Financial year
and shall required to file Statement in Form GST
ITC-3 with in 60 days from the commencement of
relevant Financial year.
4) Any Person Who has filed and intimation under
sub Rule (1) above shall also required to furnish in
form GST CMP-3 details of Stock including
inward supplies from Unregd. Person with in 60
days from the date of exercising the option.

11.  An Intimation filed in respect of any place of
business on any state shall be deemed to an
intimation filed for all other place of business
registered under same PAN.

12. Intimation
Rule 3(1):
Appointed date
Rule 3(2): After Grant of
Regd. Certificate.Date
shall be as per the date
of Sub Rule (1) or (3) as
the case may be
Rule 3(3): from
the beginning of
FY

13. Neither Casual taxable person
nor Non resident taxable
Person
If Applied under Rule 3(1),
stock as on appointed date
shall not include interstate
purchase, imported goods or
branch transfer from other
state.
Tax under RCM shall be paid
on purchase from unregistered
dealer.
Not engaged in manufacture
of goods during preceding
financial year
Mention the words “
Composition taxable person,
not eligible to collect tax “ On
Bills and “ Composite taxable
person” on sign boards at
principal place of business.

14.  Person who ceases to satisfy any condition
mentioned U/s section 10 or who wants to
withdraw from the scheme shall file withdrawal in
Form GST CMP-4 with in 7 days of such event.
 Every person who has filled withdrawal in form
CMP-4 or whose order of denial of scheme has
been passed in form CMP-7 shall file a statement
of stock of input, Inputs contained in WIP or
Finished goods held by him in form GST ITC-1 ,as
on the date of withdrawal or Order.

15. Person Rate
Manufacturer Other than
manufacturer of notified goods
1% CGST+1% SGST
Restaurant Service 2.5% CGST +2.5% SGST
Any Other Supplier 0.50% CGST+0.50% SGST

16. Particulars Due date
Quarterly Return GSTR-4 By the 18th day from the end of each
quarter.
Annual return GSTR-9A By 31st day of December following the
relevant Financial year.
Payment of Tax By the 18th day from the end of each
quarter.

17. Form Particulars Due date
GST CMP-1 Intimation to Opt
Composition Scheme by
dealer who has provided
Provisional regd.
Before or within 30 days
from the appointed date
GST CMP-2 Intimation for Opting
Composition Scheme by
Registered person.
Before Commencement
of Financial year
GST CMP-3 Details of Stock, Inward
Supplies by
Unregistered person.
Within 60 days of Opting
the scheme by a person
under Rule 3(1).
GST CMP-4 Withdrawal from the
scheme
Within 7 days from such
event.
GST CMP-5 Show cause Notice --
GST CMP-6 Reply of SCN Within 15 days from the
date of SCN
GST CMP-7 Order Within 30 days from the
receipt of Reply.