Tax liability in case of change in constitution

[Asked by Guest]

Hello

We have a partnership firm and registered as composition dealer under GST regime. now i want to convert the same to proprietorship by retiring one partner and other one continue in same business under same banner. is there any tax liability arise on closing stock? in proprietorship also i want to continue under composition dealer.

AI Summary

Change of constitution in GST: transfer of business demands fresh registration and may create tax on closing stock.
Converting a partnership composition dealer to a proprietorship requires surrender of the partnership's GST registration and obtaining a fresh registration for the proprietorship, with a new choice whether to opt for the composition scheme. Though transfer of a business as a whole may be exempt and unutilised ITC can transfer in some restructurings, a composition dealer cannot claim ITC; charging GST on closing stock risks double taxation if the proprietorship also remains under the composition scheme.