Conditions and restrictions for composition levy [ Section 10(2) Read with Rule 5 of CGST Rules ]

Composition scheme restricts eligibility by supply type, stock origin, tax payment and mandatory signage under GST.

Eligibility for the composition scheme is confined by supply type, supplier status and stock origin: opt-in is permitted only if not engaged in taxable services (except as permitted), not making exempt or inter State outward supplies, not supplying through an e commerce operator required to collect tax, not manufacturing notified goods, and not a casual or non resident taxable person. Stock on the appointed day must not originate from inter State trade, import, out of State branch/principal/agent, or unregistered suppliers unless tax is paid; composition taxpayers must pay tax on applicable inward supplies and display prescribed composition wording on bills and signboards.