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Question ID : 42273

Transfer of Machinery as a Going Concern without GST?

A PROP biz run by Mr.A from 2017 under compo sch (1%). Biz stopped on 30.04.22. Its balance sheet as on 30.04.22 is capital Rs 20 lakh & Machinery 20 Lakh (WDV). Nothing else. Another Partnership firm is formed parallel on Jan 22 (Partners Mr.A and his 2 Sons). Sales in FIRM started from 01.4.22. Actually FIRM is Continuing running the business of PROP. Can PROP transfer this machinery TO FIRM as a going concern without GST Liability? (While registering the FIRM, selected "Voluntary Basis")

Posted by Sivaraman A.R. on May 04, 2022

Filed Under GST

Answer ID : 81479

since the registered taxpayer is registered under composition scheme, the implied fact is, the party haven't claimed GST ITC on such purchase. Hence no GST is chargeable, in case of transfer of fixed asset from proprietorship firm to partnership firm.

Posted by ASHISH TULSHYAN on May 05, 2022
Answer ID : 81484

Transfer of business as a going concern has not been considered as goods under the CGST Act, 2017 Therefore, no GST is applicable.

Posted by SUDIPTA SINHA on May 06, 2022