Rajat Limited, a manufacturing concern of Rajasthan having aggregate turnover of ₹120 lakhs in financial year 2023-24 have opted for composition scheme furnishes you with the following information for financial year 2024

As per second proviso to section 10(1) to provide that a composition supplier may supply services of value not exceeding 10% of the turnover in the preceding financial year in a state or union territory or ₹5 lakh whichever is higher. Thus, Rajat Ltd. can supply services to the extent of 10% of ₹120 lakhs i.e., ₹12 lakhs. According to explanation to section 10(1), for the purposes of second proviso, the value of exempt supply of services provided by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount shall not be taken into account for determining the value of turnover in a state or union territory. Since the value of services provided excluding interest earned on deposit is ₹5,00,000 which is within the limit of ₹12 lakh, hence Rajat Ltd. is eligible for composition scheme. Computation of Aggregate Turnover and Composite Tax S. No. Particulars Amount in (₹) 1. Intra state suppliers of goods Barium hydroxide chargeable @ 5% 20,00,000 2. Intra state suppliers of goods which are chargeable to GST at Nil rate 22,00,000 3. Intra state supply of services chargeable with 5% GST 5,00,000 4. Interest earned on fixed deposits with banks (Accordingly, to explanation 2 to section 10, for the purposes of determining the tax payable by a person under this section, the expression "turnover in state or turnover in union territory" shall not include the value of exempt supply of services provided by way of extending deposits, loans or advances in so far as the consideration is represented by way of interest or discount.) Nil 5. Intra state suppliers which are wholly exempt under section 11 of CGST Act, 2017 5,40,000 6. Value of inward suppliers on which tax payable under RCM (GST rate 5%) Nil 7. Intra state suppliers of goods Basic lead carbonate chargeable @ 18% GST 28,00,000 Aggregate turnover 80,40,000 Rate of composite tax 1% Total Composite Tax (A) 80,400 Tax payable under Reverse Charge Basis Particulars Amount in (₹) Value of inward suppliers on which tax payable under RCM 5,00,000 Rate of GST 5% Tax payable under RCM (B) 25,000 Total tax liability (A)+(B) 1,05,400