Section 10 - Composition levy.

Composition levy option limits eligibility and denies input tax credit, with penalties for ineligible claimants.

Composition levy allows a registered person below the turnover threshold to opt to pay a prescribed fixed amount instead of regular tax at capped rates, subject to prescribed conditions and a possible government-notified higher threshold. Eligibility excludes inter-State supplies, supplies through certain e-commerce operators, supplies of non-taxable goods, most services, and notified manufacturers; joint PAN registrations must all opt. The option lapses on exceeding turnover limits; composition taxpayers cannot collect tax or claim input tax credit. Improper use attracts tax determination and penalties under the Act.