Q: A person deals in Petroleum crude, HSD, Petrol, Natural gas and aviation turbine fuel alongwith some cleaning services of CARS. Will he be eligible to opt for composition scheme?
A: Sec 10 (2) b states that "he is not engaged in making any supply of goods which are not leviable to tax under this Act" (highlighted in RED). Hence dealing within the items which are outside the purview of GST would not be eligible for composition scheme. Hence he can not apply Composition scheme separately for cleaning services.
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Q: Person A is making a normal supply of its goods in the state of UP however he has done a recent sale/ or intended to make sales outside UP as and when it is required. Further he also purchases its goods from UttraKhand and Punjab, Will he be eligible to OPT composition scheme?
A: Sec 10 (2) c states that " he is not engaged in making any inter-State outward supplies of goods" hence even if there is a single transaction that would have happened or person is intended to make any kind of supply (irrespective of amount/ value of such supply) then he will NOT be eligible to OPT composition scheme.
Now, coming to the next part of the question, there is NO SUCH restriction to BUY goods as INTER STATE unless it is a case of Rule 3(1) of CGST and still a person can apply for composition scheme. However sec 9(3) & Sec 9(4) and import related provision would be applied.
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Q: Person A intended to OPT for composition scheme from the appointed date i.e. 01 July 2017 and he has some stock which has been purchased from outside state, Will he be eligible to OPT composition scheme?
A: Refer to RULE 5(1) b which states that "the goods held in stock by him on the appointed day have not been purchased in the course of inter-State trade or commerce or imported from a place outside India or received from his branch situated outside the State or from his agent or principal outside the State, where the option is exercised under sub-rule (1) of rule 3"
Now, RULE 3(1) states that the " (1) Any person who has been granted registration on a
provisional basis under clause (b) of sub-rule (1) of rule 24 and who opts to pay tax under section 10, shall electronically file an intimation in FORM GST CMP-01.........
Rule 24 deals with the "Migration of persons registered under the existing law"
Hence any goods which have been purchased as Interstate and are lying as stock in trade as on Appointed day i e 01 July 2017 then for those persons COMPOSITION SCHEME would not be allowed.
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Q: Person x is engaging in manufacturing of ice creams and wants to OPT for composition scheme, Will he be eligible to OPT that?
A: As decided in 17th GST Council held on 18th June 2017, manufacturing of the following items WILL NOT BE ELIGIBLE to OPT composition scheme -
2105 00 00 ^^ Ice cream and other edible ice, whether or not containing cocoa.
2106 90 20 ^^ Pan masala
24 ^^ Tobacco and manufactured tobacco substitutes
Hence Person x can not apply for Composition scheme in this case since he engages in manufacturing of Ice creams.
Care should be taken about the restriction which is only for MANUFACTURING and not for TRADING of such items as listed for opting Composition scheme.
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A: Sec 10 (2) b states that "he is not engaged in making any supply of goods which are not leviable to tax under this Act" (highlighted in RED). Hence dealing within the items which are outside the purview of GST would not be eligible for composition scheme. Hence he can not apply Composition scheme separately for cleaning services.
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Q: Person A is making a normal supply of its goods in the state of UP however he has done a recent sale/ or intended to make sales outside UP as and when it is required. Further he also purchases its goods from UttraKhand and Punjab, Will he be eligible to OPT composition scheme?
A: Sec 10 (2) c states that " he is not engaged in making any inter-State outward supplies of goods" hence even if there is a single transaction that would have happened or person is intended to make any kind of supply (irrespective of amount/ value of such supply) then he will NOT be eligible to OPT composition scheme.
Now, coming to the next part of the question, there is NO SUCH restriction to BUY goods as INTER STATE unless it is a case of Rule 3(1) of CGST and still a person can apply for composition scheme. However sec 9(3) & Sec 9(4) and import related provision would be applied.
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Q: Person A intended to OPT for composition scheme from the appointed date i.e. 01 July 2017 and he has some stock which has been purchased from outside state, Will he be eligible to OPT composition scheme?
A: Refer to RULE 5(1) b which states that "the goods held in stock by him on the appointed day have not been purchased in the course of inter-State trade or commerce or imported from a place outside India or received from his branch situated outside the State or from his agent or principal outside the State, where the option is exercised under sub-rule (1) of rule 3"
Now, RULE 3(1) states that the " (1) Any person who has been granted registration on a
provisional basis under clause (b) of sub-rule (1) of rule 24 and who opts to pay tax under section 10, shall electronically file an intimation in FORM GST CMP-01.........
Rule 24 deals with the "Migration of persons registered under the existing law"
Hence any goods which have been purchased as Interstate and are lying as stock in trade as on Appointed day i e 01 July 2017 then for those persons COMPOSITION SCHEME would not be allowed.
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Q: Person x is engaging in manufacturing of ice creams and wants to OPT for composition scheme, Will he be eligible to OPT that?
A: As decided in 17th GST Council held on 18th June 2017, manufacturing of the following items WILL NOT BE ELIGIBLE to OPT composition scheme -
2105 00 00 ^^ Ice cream and other edible ice, whether or not containing cocoa.
2106 90 20 ^^ Pan masala
24 ^^ Tobacco and manufactured tobacco substitutes
Hence Person x can not apply for Composition scheme in this case since he engages in manufacturing of Ice creams.
Care should be taken about the restriction which is only for MANUFACTURING and not for TRADING of such items as listed for opting Composition scheme.
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