New composition scheme of Tax of 5% under Delhi VAT

1
Customer Care No. 91-11-45562222
New composition scheme of Tax of 5 under Delhi
VAT
www.taxmann.com
2

• A new composition scheme has been notified under
  the Delhi VAT Act Vide Notification No.
  F.3(29)/Fin(Rev-I) 2015-2016/dsvi/93 dated
  18.3.2016 with effect from 1.4.2016 for every
  registered dealer -
• (i)whose turnover during the preceding year as
  well as expected turnover during current year
  does not exceed Rs.50 lacs and
• (ii)who is not making any sales other than that
  of ready to eat foods and non-alcoholic beverages
  including cooked food, snacks, sweets, savouries,
  juices, aerated drinks, tea coffee etc. and
  served in or catered indoors or outdoors by
  hotels, restaurants, sweet-stalls, sweet shops,
  clubs, caterers any other eating houses.

Customer Care No. 91-11-45562222
www.taxmann.com
3

• Such dealer may elect for the new composition
  scheme and pay tax _at_ 5 of the entire turnover.
  The electing registered dealer shall comply with
  the conditions and restrictions specified in this
  notification, such as, -
• (a) He shall not be eligible for making purchases
  from or procuring goods from or making sales to
  or making supplies to any place outside Delhi
• (b) He shall not be eligible for making purchases
  from a person who is not registered under the
  DVAT Act except in the case of goods specified in
  the First Schedule
• (c) He shall not be eligible to claim tax credit
  under section 9 of the Act
• (d) He shall not calculate his net tax under
  section 11 of the Act
• (e) He shall not collect any amount by way of tax
  under the Act
• (f) He shall not be entitled to issue 'Tax
  Invoices'.

Customer Care No. 91-11-45562222
www.taxmann.com
4

• A registered dealer, who is paying tax under
  section 3 of the Act (as a normal dealer), can
  opt for payment of tax under this scheme by
  filing an application in Form RH-01 within a
  period of 30 days from the first day of the year
  with effect from which composition is opted. For
  the year 2016-17, application for composition
  under this Scheme could be filed up to 30th April
  2016
• A dealer applying for a fresh registration can
  also opt for this scheme by filing application in
  Form RH 01 along with his registration
  application in Form DVAT 04.
• As per second proviso to Section 16(1) of the
  DVAT Act (inserted w.e.f. 1.4.2013), where a
  separate composition scheme has been notified u/s
  16(12), those dealers cannot elect for general
  composition u/s 16(1) of 1. Therefore, where any
  dealer, covered by this notification, has already
  opted for composition scheme u/s 16(1) of the
  Act, such dealer shall mandatorily withdraw from
  the composition scheme w.e.f. 1.4.2016 by filing
  application in Form DVAT-03 upto 30.4.2016.
  However, such dealer can opt for the new
  composition scheme of 5 specified through this
  notification.

www.taxmann.com
Customer Care No. 91-11-45562222
5
To read more, please click here
Customer Care No. 91-11-45562222
www.taxmann.com