GST composition

This query is : Resolved

Guest

Guest (Querist)

01 September 2020 My client's sales crossed the threshold limit of 1 crore during march 2019 by 9.5 lakhs. As I became aware of that only in April 2019 and for 2019-20 FY (threshold became 1.5 crore in 2019-20 fy) composition was continued. Now what are the consequences on this? It is required by a composition dealer to opt out of composition as the sales cross the threshold and to pay gst at the normal rates and file ITC form to avail credit on the stock which I haven't done in due time. As a composition dealer has to become a regular dealer once his sales cross the composition threshold, does this have an assessment impact on my stock to opt composition during 2019-20 FY? Am I eligible to deduct the one percent GST I had already paid on the 9.5 turnover while paying tax on 9.5 at the normal rate plus interest by filing a DRC03 for the threshold crossed turnover? Is my composition for 2019-20 FY legal? Is there any penalty involved?

Lekhraj sood

Lekhraj sood (Expert)
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01 September 2020 1. If you have not availed any ITC on the closing stock on 31st March 2019 then there would be no impact on the assessment on account of stock.
2. Since your t/o in 2018-19 was less than 1.5 crores you would be eligible to opt for composition scheme fro April 2019.
3. I do not think there is any provision to make this adjustment of 1%. But Yes, you can file refund of 1% composition GST as tax paid in excess u/s 54.
4. You will have to file late fee if delay in filings.

Guest

Guest (Querist)

01 September 2020 Thanks heaps sir. Your reply helped a lot. I have filed my returns till date on a quarterly basis without fail. Can I apply for refund US 54 for 2018-19 still?

Lekhraj sood

Lekhraj sood (Expert)
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01 September 2020 yes, there is time limit of 2 years,so you have time to file refund.

Guest

Guest (Querist)

01 September 2020 Thanks sir. Will do.

Guest

Guest (Querist)

19 September 2020 A recent dig shone light to a very interesting matter. Notification 02/2019 of the CGST Act amendment raising the threshold from 1 crore to 1.5 crore has its effect from 01.02.2019(not 01.04.2019). My client's sales has crossed 1 crore limit in march 2019. So by virtue of notification 02/2019 my client's composition threshold is safe.