The goods and services tax (GST) regime allows only one registration against a permanent account number (PAN), but firms with multiple business verticals can choose to apply for multiple registration numbers against a corresponding PAN number, revenue secretary Hasmukh Adhia clarified on Thursday. Answering a query on whether an entity which runs a manufacturing unit as well as a trading arm can have two different registrations, Adhia said it was an option and such a business can request the GST Network for multiple registration numbers. However, he added that such firms would be taxed on aggregate revenue of all the verticals. That is, these verticals with separate registration numbers can’t opt for the composition scheme in each for the turnover being below the specified threshold, if the aggregate turnover exceeds the limit. The composition scheme allows some businesses — manufacturers, traders and restaurants — with turnover of less than Rs 75 lakh per annum to pay a percentage of turnover as tax and file returns quarterly, rather than pay GST. “Separate verticals of a same business can’t be part of composition scheme. The entity will also be taxed on aggregate revenue of all its arms,” Adhia said.
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Adhia, along with the Central Board of Excise and Customs chairperson and other officials, were speaking on the first day of the proposed six-day session on GST. The GST Network, which has build its IT backbone, was represented by CEO Prakash Kumar.