Withdrawal from Composition Levy

For new FY composition scheme starts from 1st April; so you can withdraw from scheme only after 1st April, 2023.

Sir,

For an existing (from 01/04/2019) Composition Dealer (services), upon Turnover exceeding 50 lakhs, one has to opt for Regular within 7 days or so. Turnover exceeded on 31/03/2023. Hence the application today seeking withdrawal from (wef) the date turnover exceeded 50 lakhs.

And have a look at the reason - 'Withdrawal from Composition Levy Date cannot be before Opt for Composition Levy Date'. How & what to interpret? The Dealer opted for Composition on 01/04/2019 & is seeking withdrawal from 31/03/2023. How is 31/03/2023 before 01/04/2019?

Not able to comprehend the things :(

The practical difficulty is the system has rolled over to new FY 2023-24.

You are correct in your interpretation but think why you are given Rs. 50 lakhs limit for each FY, even though you have exceeded total turnover to about 2-3 crores? As per your understanding you should have opted out from composition scheme whenever you had exceeded Rs. 50 lakhs limit without considering the limit for each FY?

 

Sir.... Turnover crossed 50 Lakhs on 31/03/2023 itself :)

We are not choosing 31/03/2023 arbitrarily.

So even the very next day i.e. 01/04/2023 would fall in FY 2023-24.

But isn't the reason totally wrong? As such the Dealer has opted for Composition on 01/04/2019.

We don't know which date & why the Portal is considering as the Opt for Composition Levy Date.

Whether your turnover 50 lakhs was for FY 2022-23 or from FY 2019-20 till up to date, in aggregate?

If you say for FY 2022-23, then you cannot deny the system rolling over to new financial year from 01.04.2023.

Turnover for FY 2019-20 to FY 2021-22 was below 50 Lakhs.

Turnover for FY 2022-23 was 49 Lakhs till 30/03/2023 and on 31/03/2023, the very day, it crossed 50 Lakhs & went up to 53 lakhs or so. Hope I am clear.

You are not replying the aggregate turnover!! you have replied turnover for each Financial separately!!

Unless you agree to it you won't understand the concept.

Just to reiterate, please read the reason carefully : 'Withdrawal from Composition Levy Date cannot be before Opt for Composition Levy Date'

The Dealer had opted for Composition Levy from 01/04/2019 and 

Withdrawal is requested from 31/03/2023.

And obviously 31/03/2023 is not before 01/04/2019 :)

This is how I am interpreting. Just let me know if i am making some error.

I repeat, you won't understand the concept till you consider the above referred discussion.

Sir,

Frankly I am truly not able to understand & confused :)

Annual Turnover (or aggregate Turnover whatever we may call it) for each of past 3 years i.e. FY 2019-20 to FY 2021-22 was below 50 Lakhs.

For FY 2022-23 it was 49 Lakhs or so till 30/03/2023 and on 31/03/2023, the very last day, it crossed 50 Lakhs (& reached up to 53 lakhs or so).

Sir,

Making an unreasonable request.

Is there a way we can talk over phone?

Its very simple to understand that you have taken advantage of Rs. 50 lakhs limit for each financial year separately.

So, if you do not accept the point, there is no need to provide you real resolution.

Sorry...

& Good luck....

Sir,

Don't mind my continuing further. It is just to seek absolute clarity.

1. So isn't the 50 Lakhs limit for each FY?

2. Are you saying if TO was 40 lakhs for 2019-20 and it crossed 10 lakhs in & for FY 2020-21 on 8th July, 2020 (so now the aggregate TO from 01/04/2019 is now 50 Lakhs plus), one should have applied for Withdrawal from Composition on 8th July, 2020?

Dear Sanjay
First of all
One can any time during the financial year opt out of Composition Scheme as law does not restrict. Yes to opt in you have file CMP-02 before beginning of FY.

As per Rule 6 if you ceases to satisfy any condition mentioned in Section 10 ie in your case Turnover get exceeds 50 lac then you need to opt out within 7 days from composition scheme.

So as I replied above that one can any time during FY can opt out from Composition. Thus I assume that either it is some portal glitch or you are having more GSTN under same PAN registered under Composition scheme.(ref: Rule 11(1)(b))