Answer

1. F

   Facts

   Yes. A new applicant can opt for composition in the REG-01 form if eligible. Composition is for goods suppliers and restaurants with turnover up to ₹1.5 crore, and a separate 6 percent scheme exists for service providers up to ₹50 lakh.

2. P

   Provisions and law

   • Rule 3, CGST Rules 2017Opting for composition: new applicants opt in REG-01; existing taxpayers file CMP-02 before the start of the financial year.
   • Sec 10(1), CGST Act 2017A registered person with aggregate turnover up to the notified limit (₹1.5 crore, lower in special category States) may opt to pay tax at a fixed rate on turnover.
   • Sec 10(2A), CGST Act 2017Service providers and mixed suppliers with turnover up to ₹50 lakh may pay tax at a concessional rate (6 percent, 3 percent CGST plus 3 percent SGST) under the notified scheme.
3. A

   Analysis

   Composition means paying a fixed percentage of turnover, filing CMP-08 quarterly and GSTR-4 yearly, with no input tax credit. A trader selling ₹60 lakh of goods pays 1 percent, ₹60,000, instead of collecting tax on each bill. It does not suit businesses selling inter-State or to B2B buyers who want credit. Choose it only after checking eligibility conditions under Rule 5.

4. C

   Conclusion

   1. 1Check eligibility: no inter-State sales, no excluded goods.
   2. 2Compare tax cost under composition with regular scheme.
   3. 3Tick the composition option in REG-01 if it suits you.
   4. 4Plan CMP-08 by the 18th after each quarter.

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