Purchase from composition dealer

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This discussion clarifies the tax implications when a regular dealer purchases goods from a composition dealer. It's confirmed that such purchases are not considered unregistered. While no tax is immediately payable on the purchase itself, the regular dealer will pay the applicable GST rate when they eventually sell the goods. The purchase price simply becomes part of the regular dealer's cost.

karan kumar

karan kumar (Querist)

09 January 2020 Dear Members!
If a regular dealer purchase the goods from composition dealer! Than whether this goods will be considered as unregistered purchase and have to pay applicable tax thereon!

Pls clarify.....

Thanks & Regards
Karan kumar

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)

09 January 2020 No, the composition tax payer is also a registered person so he cannot be equated with an unregistered purchase.

karan kumar

karan kumar (Querist)

09 January 2020 Sir! Does that mean on purchase from composition dealer No need to pay tax. Only stock will be added however while sale thereof tax will be paid,

Pls clarify....

Akash Monwani

Akash Monwani (Expert)

09 January 2020 The Purchase is from Registered Person and as u are regular taxpayer the purchase price will be your cost and at the time of sale u need to pay GST at respective rate

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