Lamb & Co. commenced business in retail trade of electronic goods on 5th June, 2023. It applied for registration under regular scheme on the same day. The goods are liable for CGST @ 9% and SGST @ 9%. Its turnover fo

Procedure to be followed for change over to Composition Scheme: In the present case, Lamb & Co. is already registered under GST in regular scheme. Now, from 1.4.2024 onwards, it wants to opt for composition scheme under section 10 of CGST Act. The procedure in this regard is as below. Lamb & Co. shall intimate electronically in form GST CMP 02 prior to the commencement of the financial year 2024-25. The amount of input tax credit relating to inputs held in stock, inputs contained in semi-finished and finished goods held in stock, and capital goods held in stock shall, be determined in the following manner, namely, - for inputs held in stock and inputs contained in semi-finished and finished goods held in stock, the input tax credit shall be calculated proportionately on the basis of the corresponding invoices on which credit had been availed by the registered taxable person on such inputs; for capital goods held in stock, the input tax credit involved in the remaining useful life in months shall be computed on pro rata basis, taking the useful life as five years. On determination of credit liable to be reversed, it shall further furnish the statement in Form GST ITC 03 i.e. ITC reversal on stock within a period of 60 days from the date of commencement of the relevant financial year. [Rule 3(3)]. The credit if any remained in electronic credit ledger after such reversal shall lapse. Having opted for section 10, the registered person shall not collect any tax from the appointed day but shall issue bill of supply for supplies made after the said day. [Proviso to rule 3(1)] The intimation filed by Lamb & Co. shall be applicable shall be deemed to be an intimation in respect of all other places of business registered on the same PAN. [Rule 3(5)] The option to pay tax under section 10 shall be effective from the beginning of the financial year i.e. w.e.f. 1.4.2024. Composite dealer not to collect tax & not claim Input Tax Credit [Section 10(4)]