Switch over from normal scheme to composition scheme and vice versa

Switch over from normal scheme to composition scheme and vice versa :

Switch over from normal scheme to composition scheme and vice versa is permissible and specific provisions have been made in CGST Act for this purpose.

Switching from composition scheme to normal scheme of payment of tax on basis of value – Section 18(1)(c) of CGST Act states that if taxable person switches over from composition scheme to normal scheme, he is entitled to take credit of input tax in respect of inputs held in stock, inputs contained in semi-finished or finished goods held in stock and on capital goods on the day immediately preceding the date from which he becomes liable to pay tax under section 9 of CGST Act.

Switching from normal scheme of payment of tax on basis of value to composition scheme – Section 18(4) of CGST Act states that where any registered person who has availed of input tax credit opts to pay tax under section 10 of CGST Act or, where the goods or services or both supplied by him become wholly exempt, he shall pay an amount, by way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or
finished goods held in stock and on capital goods, reduced by such percentage points as may be prescribed, on the day immediately preceding the date of exercising of such option or, as the case may be, the date of such exemption.