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    ManualsIncome Tax
    Can ICDS apply to a person following cash system of accounting and to the person whose books of acco...
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    ManualsIncome Tax
    Show AI Summary
    ICDS applicability limited to mercantile accounting; excludes cash-accounting and individuals/HUFs not subject to tax audit.
    ICDS applies to persons following the mercantile system of accounting and does not apply to those following the cash system. For individuals and HUFs, ICDS is applicable only if they carry on business or profession and their books are required to be audited under the tax audit provisions; it does not apply where there is no business or professional income even if mercantile accounting is followed for other heads.
    ManualsGST
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    Reversal of Input Tax Credit on switching to composition scheme; capital goods credit prorated by remaining useful life.
    Switching to the composition scheme requires reversal of Input Tax Credit on inputs, inputs in semi finished or finished goods held in stock, and capital goods held in stock as on the day before the option is exercised, by payment from the electronic credit or cash ledger after prescribed reductions. For capital goods, reversal is prorated by remaining useful life using an assumed five year useful life, with the credit attributable to remaining months computed as original credit multiplied by remaining months divided by sixty.
    ManualsGST
    Show AI Summary
    Input tax credit eligibility on switching from composition to normal scheme - capital goods credit reduced over time, subject to time bar.
    A taxpayer switching from the composition scheme to the normal scheme may claim Input Tax Credit for inputs, inputs in goods held in stock, and capital goods held immediately before liability to pay tax, but credit for capital goods must be reduced by the prescribed periodic reduction measured from the invoice or receipt date, and no credit may be claimed for supplies after one year from the tax invoice date.
    Act RulesGST
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    Input Tax Credit denial: purchases from composition taxpayers are ineligible for ITC under the GST regime.
    A composition scheme taxpayer is excluded from the input tax credit chain, cannot issue a tax invoice or collect tax, and must state that no credit is available. Consequently, a registered person purchasing from a composition dealer cannot claim Input Tax Credit because the supplier does not charge GST in a manner that would enable the recipient to treat the payment as tax paid for ITC purposes.
    Act RulesGST
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    Composition scheme threshold triggers monthly tax payment and monthly returns requirement for the affected taxpayer.
    A taxpayer under the Composition Scheme may pay and file on the quarterly schedule (guidance noting payment on the 18th and quarterly return on the 18th after quarter-end). If the taxpayer crosses the threshold or withdraws from composition, they become a regular taxable person and must pay tax and furnish returns monthly by the 20th of the following month for the remainder of the financial year and subsequent years.
    Act RulesGST
    Show AI Summary
    GST payment due date: monthly filers pay with next-month return; composition filers pay with quarterly return.
    Tax under GST must be paid not later than the return's due date. Monthly filers must file GSTR-3 and pay tax by the twentieth day of the month following the tax month. Composition taxpayers under the composition scheme file quarterly in GSTR-4 and must pay tax by the eighteenth day after the quarter ends.
    Act RulesGST
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    Composition levy on exempt supplies raises eligibility ambiguity due to turnover inclusion versus ineligibility for non leviable supplies.
    The composition levy's tax base, as defined by turnover, expressly includes exempt supplies, indicating that composition tax is payable having regard to exempted goods; however, Section 10(2)(b) disqualifies persons making supplies "not leviable to tax," creating an ambiguity whether exempt supplies (which definitionally includes nil rated and wholly exempt supplies and non taxable supplies) render a person ineligible for composition. Commentators note this tension and call for clarification or amendment to reconcile the turnover inclusion with the eligibility restriction.
    Act RulesGST
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    Eligibility for composition scheme may be barred by prior inter state supplies, even if current turnover is below threshold.
    A registered person who made inter state supplies during the previous year is ineligible to opt for the composition scheme in the current year, because eligibility under Section 10 is determined with reference to the preceding financial year; thus the absence of inter state supplies must be assessed for the previous year even if turnover remains below the threshold.
    Act RulesGST
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    Composition scheme eligibility: turnover in preceding financial year determines entitlement; aggregate turnover is all-India and fresh declaration required.
    Eligibility for the composition scheme depends on aggregate turnover in the preceding financial year not exceeding the prescribed threshold; aggregate turnover is computed on an all India basis and includes taxable supplies (excluding inward reverse charge supplies), exempt supplies, exports and inter State supplies by the same PAN, while excluding GST and cess. Eligibility is reassessed each year; a fresh declaration is required to opt into the scheme after becoming eligible.
    Act RulesGST
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    Composition scheme validity continues while statutory conditions are met; annual intimation is not required for eligible taxpayers.
    The composition levy remains valid so long as statutory eligibility conditions and applicable CGST Rules are complied with; no fresh annual intimation is required if those conditions continue to be met.
    Act RulesGST
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    Composition levy option must be elected before the financial year begins; prior electronic intimation required.
    The option to pay tax under the composition levy must be exercised by giving electronic intimation in FORM GST CMP-02 prior to the commencement of the relevant financial year under the Central Goods and Services Tax Rules, 2017.
    Act RulesGST
    Show AI Summary
    Composition levy withdrawal: file FORM GST CMP-04 and submit FORM GST ITC-01 detailing stock within the prescribed period.
    Withdrawal from the composition scheme is effected by filing a duly signed or verified application in FORM GST CMP-04, and the applicant must electronically furnish FORM GST ITC-01 detailing stock of inputs and inputs contained in semi-finished or finished goods held on the date of withdrawal within thirty days of withdrawal.
    Act RulesGST
    Show AI Summary
    Composition scheme: importers may remain in composition though IGST on imports may not yield input tax credit, service providers excluded.
    Importers can opt for the composition scheme where otherwise eligible; there is no categorical bar on importers availing composition levy. IGST is payable on import and such tax may not yield input tax credit for a composition taxpayer. Pure service providers remain ineligible for composition, and importing services for business or captive consumption does not automatically make a person a service provider or disqualify composition eligibility.
    Act RulesGST
    Show AI Summary
    Composition scheme eligibility: exporters cannot use composition tax where their supplies are treated as inter State, barring such option.
    Exports are treated as inter State supplies for GST purposes. The composition levy prohibits a taxpayer from making inter State outward supplies of goods while paying tax under the composition scheme. Therefore, an exporter whose transactions are classified as inter State supplies cannot opt to pay tax under the composition scheme in respect of those export supplies.
    Act RulesGST
    Show AI Summary
    Composition scheme: suppliers cannot make inter State outward supplies to SEZ while remaining in the scheme.
    Supplies from the domestic tariff area to an SEZ are treated as inter State supplies, and Rule 5/Section 10 conditions for the composition levy prohibit a composition taxpayer from making inter State outward supplies; therefore a person paying tax under the composition scheme cannot make outward supplies of goods to an SEZ while remaining in the scheme.
    Act RulesGST
    Show AI Summary
    Composition scheme eligibility denied where stock on appointed day was purchased inter state, imported, or received from outside State.
    Persons below the turnover threshold who hold stock on the appointed day cannot opt for the composition scheme if that stock was purchased inter state, imported, or received from an out of State branch, agent or principal; possession of such goods on the appointed day disqualifies a registered person from the composition levy.
    Act RulesGST
    Show AI Summary
    Composition scheme eligibility barred for casual and non-resident taxable persons; cannot claim composition as casual dealer.
    A taxpayer acting as a casual taxable person or a non-resident taxable person is expressly excluded from the composition levy; therefore casual dealers and non-resident taxable persons cannot avail the composition scheme while operating in that capacity.
    Act RulesGST
    Show AI Summary
    Composition scheme ineligibility: manufacturers of ice cream, pan masala and tobacco and certain suppliers cannot opt.
    Section 10(2) excludes five categories from the composition scheme: suppliers of services (except restaurant services), suppliers of non taxable goods, inter State suppliers, persons supplying through electronic commerce operators, and manufacturers of notified goods. Rule 5 adds further ineligible classes. A notification further specifies that manufacturers of ice cream, pan masala, and all tobacco and manufactured tobacco substitutes are not eligible for composition levy.
    Act RulesGST
    Show AI Summary
    Composition scheme lapse triggers transition to regular tax liability and requires issuing tax invoices and filing withdrawal notice promptly.
    Crossing the aggregate turnover threshold causes the composition option to lapse from the day the threshold is exceeded; the person is liable to pay tax under section 9 from that day and must issue tax invoices for every taxable supply made thereafter. The person must also file an intimation for withdrawal from the scheme in FORM GST CMP-04 within seven days of the occurrence of such event.
    Act RulesGST
    Show AI Summary
    Composition scheme eligibility may be available for suppliers using e-commerce operators while TDS/TCS provisions remain inoperative.
    Eligibility for the composition scheme is negated for suppliers making supplies through an electronic commerce operator required to collect tax at source; however, because the TDS/TCS provisions are not yet operative and ECOs are not required to collect tax, suppliers using ECOs may currently opt for the composition scheme until the collection provisions are brought into force, and an administrative clarification from the government is recommended to remove uncertainty.

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      AMENDMENTS IN THE FIRST SCHEDULE TO THE CUSTOMS TARIFF ACT, 1975

      3 February, 2020

      Contents
      Rules & Regulations
      Plus +
      Summary
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      Budget 2020-21 + FINANCE BILL, 2020

      AMENDMENTS

      A.

      Tariff rate changes for Basic Customs Duty [to be effective from 02.02.2020] * [Clause 115 (a) of the Finance Bill, 2020]

      Rate of Duty

      S.No.

      Heading, sub-heading, tariff item

      Commodity

      From

      To

       

       

      Food processing

       

       

      1.

      0802 32 00

      Walnuts, shelled

      30%

      100%

       

       

      Chemicals

       

       

      2.

      3824 99 00

      Other Chemical products and preparations of the chemical or allied industries, not elsewhere specified

      10%

      17.5%

       

       

      Footwear

       

       

      3.

      6401, 6402,

      6403, 6404, 6405

      Footwear

      25%

      35%

      4.

      6406

      Parts of footwear

      15%

      20%

       

       

      Household Items

       

       

      5.

      6911 10, 6911 90 20, 6911 90 90

      Tableware, kitchenware, water filters (of a capacity not exceeding 40 litres) and other household articles, of porcelain of china.

      10%

      20%

      6.

      6912 00 10, 6912 00 20, 6912 00 40, 6912 00 90

      Ceramic tableware, kitchen-ware, clay articles and other household articles

      10%

      20%

      7.

      7013

      Glassware of a kind used for table, kitchen, toilet, office, indoor decoration or Similar purposes (other than that of heading 7010 or 7018)

      10%

      20%

      8.

      7323

      Table kitchen or other household articles and parts thereof, of iron or steel, iron or steel wool; pot scourers and scouring or polishing pads, gloves and the like, of iron or steel, including pressure cookers pans utensils, misc articles such as iron & steel wool, polishing pads, gloves etc.

      10%

      20%

      9.

      7418 10

      Table, kitchen or other household articles and parts thereof, of copper; pot scourers and scouring or polishing pads, gloves and the like, of copper.

      10%

      20%

      10.

      7615 10

      Table, kitchen or other household articles and parts thereof, of aluminum; pot scourer and scouring or polishing pads, gloves and the like, of aluminum.

      10%

      20%

      11.

      8301

      Padlocks and locks (key, combination or electrically operated) of base metal; Clasps and frames with clasps, incorporating locks of base metals; keys for any of the foregoing articles, of base metals (Other than lock of a kind used for automobiles.)

      10%

      20%

      12.

      9603

      Brooms, brushes, hand operated mechanical floor sweepers, not motorized, mops and feather dusters; prepared knots and tufts for broom or brush making; paint pads and rollers; Squeegees (other than roller squeegees).

      10%

      20%

      13.

      9604 00 00

      Hand sieves and hand riddles.

      10%

      20%

      14.

      9615

      Combs, hair-slides and the like, hairpins curling pins, curling grips, hair curlers and the like other than those of heading 8516 and parts thereof.

      10%

      20%

      15.

      9617

      Vacuum flasks and other vacuum vessels, complete with cases; parts thereof other than glass inners.

      10%

      20%

      16.

      8414 51 10

      Table Fans

      10%

      20%

      17.

      8414 51 20

      Ceiling Fans

      10%

      20%

      18.

      8414 51 30

      Pedestal Fans

      10%

      20%

      19.

      8414 59 20

      Blowers, Portable

      10%

      20%

      20.

      8509 40 10

      Food Grinders

      10%

      20%

      21.

      8509 40 90

      Other grinders and Mixer

      10%

      20%

      22.

      8509 80 00

      Other Appliances

      10%

      20%

      23.

      8510 10 00

      Shavers

      10%

      20%

      24.

      8510 20 00

      Hair Clippers

      10%

      20%

      25.

      8510 30 00

      Hair-removing appliances

      10%

      20%

      26.

      8516 10 00

      Water heaters and immersion heaters

      10%

      20%

      27.

      8516 21 00

      Storage heating radiators

      10%

      20%

      28.

      8516 29 00

      Other electrical space heating apparatus

      10%

      20%

      29.

      8516 31 00

      Hair Dryers

      10%

      20%

      30.

      8516 32 00

      Other hair dressing apparatus

      10%

      20%

      31.

      8516 33 00

      Hand Drying apparatus

      10%

      20%

      32.

      8516 40 00

      Electric smoothing irons

      10%

      20%

      33.

      8516 60 00

      Other ovens, cookers, cooking plates, boiling rings, grillers and roasters

      10%

      20%

      34.

      8516 71 00

      Coffee and Tea Makers

      10%

      20%

      35.

      8516 72 00

      Toasters

      10%

      20%

      36.

      8516 79 10

      Electro-thermic fluid heaters

      10%

      20%

      37.

      8516 79 20

      Electrical or electronic devices for repelling insects

      10%

      20%

      38.

      8516 79 90

      Other electro-thermic appliances used for domestic purposes

      10%

      20%

      39.

      8516 80 00

      Electric heating resistors

      10%

      20%

       

       

      Precious Metals

       

       

      40.

      7118

      Coin

      10%

      20%

       

       

      Machinery

       

       

      41.

      8414 51 40

      Railway Carriage fans

      7.5%

      10%

      42.

      8414 51 90

      Other fans with a self-contained electric motor not exceeding 125W

      7.5%

      20%

      43.

      8414 59 10

      Air Circulator

      7.5%

      10%

      44.

      8414 59 30

      Industrial fans blowers and similar blowers

      7.5%

      10%

      45.

      8414 59 9

      Other industrial fans

      7.5%

      10%

      46.

      8414 30 00, 8414 80 11

      Compressor of Refrigerator and Air conditioner

      10%

      12.5%

      47.

      8419 89 10

      Pressure vessels

      7.5%

      10%

      48.

      8418 10 10

      Commercial type combined refrigerator freezers, fitted separate external doors

      7.5%

      15%

      49.

      8418 30 10

      Commercial freezer of chest type, not exceeding 800 litre capacity

      7.5%

      15%

      50.

      8418 30 90

      Other chest type freezers

      10%

      15%

      51.

      8418 40 10

      Electrical freezers of upright type, not exceeding 800 litre capacity

      7.5%

      15%

      52.

      8418 40 90

      Other freezers of upright type, not exceeding 800 litre capacity

      7.5%

      15%

      53.

      8418 50 00

      Refrigerating or freezing display counters, cabinets, Show-cases and the like

      7.5%

      15%

      54.

      8418 61 00

      Heat pumps other than air conditioning machines

      7.5%

      15%

      55.

      8418 69 10

      Ice making machinery

      7.5%

      15%

      56.

      8418 69 20

      Water cooler

      10%

      15%

      57.

      8418 69 30

      Vending machine, other than automatic

      10%

      15%

      58.

      8418 69 40

      Refrigerating equipment/devices used in leather industry

      7.5%

      15%

      59.

      8418 69 50

      Refrigerated farm tanks, industrial ice cream freezer

      7.5%

      15%

      60.

      8418 69 90

      Others (like freezers of capacity 800 litres and more etc.]

      7.5%

      15%

      61.

      8515 (except 8515 90 00)

      Welding and Plasma cutting machines

      7.5%

      15%

       

       

      Other Electronic goods

       

       

      62.

      8504 40 (except 8404 40 21)

      Static Converters

      15%

      20%

      63.

      8504 40 21

      Dip bridge rectifier

      10%

      20%

      64.

      8517 70 10

      Populated, loaded or stuffed printed circuit boards

      10%

      20%

       

       

      Automobile and automobile parts

       

       

      65.

      8421 39 20, 8421 39 90

      Catalytic Convertor

      10%

      15%

       

       

      Furniture Goods

       

       

      66.

      9401

      Seats and parts of seats (other than aircraft seats and their parts)

      20%

      25%

      67.

      9403

      Other Furniture and parts thereof

      20%

      25%

      68.

      9404

      Mattress supports: Articles of bedding and similar furnishing

      20%

      25%

      69.

      9405

      Lamps and lighting fittings including searchlights and spotlights and pads thereof; Illuminated signs, illuminated name plates and the like, having a permanently fixed light source, and parts thereof (except solar lantern and solar lamps).

      20%

      25%

       

       

      Toys

       

       

      70.

      9503

      Tricycles, scooters, pedal-cars and similar wheeled-toys; dolls' carriages; dolls; other toys; reduced-Size (“scale”) models and similar recreational models, working or not; puzzles of all kinds

      20%

      60%

       

       

      Stationary items

       

       

      71.

      8304 00 00

      Filing, cabinets. card-index cabinets, paper-trays, paper rests, pen trays, office-stamp stands and similar office or desk equipment of base metal, Other than office furniture of heading 9403

      10%

      20%

      72.

      8305

      Fittings for loose-leaf binders or files, letter clips, letter corners, paper clips, indexing tags and similar office articles, of base metal; staples in strips (for example, for offices, upholstery, packaging), of base metal

      10%

      20%

      73.

      8310

      Sign-plates, name-plates, address-plates and similar plates, numbers, letters and other symbols, of base metal, excluding those of heading 9405

      10%

      20%

       

       

      Miscellaneous

       

       

      74.

      6702

      Artificial Flowers

      10%

      20%

      75.

      7018 10 20

      Glass Beads

      10%

      20%

      76.

      8306

      Bells, gongs, statuettes, trophies and like, non-electric of base metal; statuettes and other ornaments of base metal; photograph, picture or similar frames, of base metal; mirrors of base metal.

      10%

      20%

      B.

      New entries added to the First Schedule [to be effective from 02.02.2020] * [Clause 115(b) of the Finance Bill, 2020]

      S. No

      Tariff Item

      Description

      Tariff Rate

      Effective rate

      1.

      8414 51 50

      Wall fans

      20%

      20%

      2.

      8529 90 30

      Open cell for television set

      15%

      0%

      3.

      8541 40 11

      Solar cells, not assembled

      20%

      0%

      4.

      8541 40 12

      Solar cells, assembled in modules or made up in panels

      20%

      0%

      *Will come into effect immediately owing to a declaration under the Provisional Collection of Taxes Act, 1931.

       


      Full Text:

      Budget 2020-21 + FINANCE BILL, 2020

      Topics

      ActsIncome Tax