Composition scheme for works contractors allows a turnover-based lump-sum tax with restrictive eligibility and compliance obligations. A composition tax regime permits registered works contractors to pay a specified composition amount on turnover instead of normal tax, with differentiated rates depending on whether purchases and sales occur solely within the Territory or involve out-of-Territory procurement or supplies. Opting requires filing the prescribed form and remains valid for three consecutive years. Composition dealers are barred from claiming input tax credit, issuing tax invoices, collecting tax, making interstate purchases on declaration forms or importing goods; they must declare and pay tax on opening stock and reverse input tax credit on capital goods claimed in the preceding three years.
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Provisions expressly mentioned in the judgment/order text.
Composition scheme for works contractors allows a turnover-based lump-sum tax with restrictive eligibility and compliance obligations.
A composition tax regime permits registered works contractors to pay a specified composition amount on turnover instead of normal tax, with differentiated rates depending on whether purchases and sales occur solely within the Territory or involve out-of-Territory procurement or supplies. Opting requires filing the prescribed form and remains valid for three consecutive years. Composition dealers are barred from claiming input tax credit, issuing tax invoices, collecting tax, making interstate purchases on declaration forms or importing goods; they must declare and pay tax on opening stock and reverse input tax credit on capital goods claimed in the preceding three years.
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