Rule 5. Conditions and restrictions for composition levy. -
(1) The person exercising the option to pay tax under
section 10 shall comply with the following conditions, namely: -
(a) he is neither a casual taxable person nor a
non-resident taxable person;
(b) the goods held in stock by him on the appointed
day have not been purchased in the course of inter-State trade or commerce or
imported from a place outside India or received from his branch situated
outside the State or from his agent or principal outside the State, where the
option is exercised under sub-rule (1) of rule 3;
(c) the goods held in stock by him have not been
purchased from an unregistered supplier and where purchased, he pays the tax
under sub-section (4) of section 9;
(d) he shall pay tax under sub-section (3) or
sub-section (4) of section 9 on inward supply of goods or services or both;
(e) he was not engaged in the manufacture of goods as
notified under clause (e) of sub-section (2) of section 10, during the
preceding financial year;
(f) he shall mention the words "composition
taxable person, not eligible to collect tax on supplies" at the top of the
bill of supply issued by him; and
(g) he shall mention the words "composition
taxable person" on every notice or signboard displayed at a prominent
place at his principal place of business and at every additional place or
places of business.
(2) The registered person paying tax under section 10
may not file a fresh intimation every year and he may continue to pay tax under
the said section subject to the provisions of the Act and these rules.
