1.
Sir,
According to sub-section 1A of Section 7 of CGST Act, 2017 "where certain activities or transactions constitute a supply in accordance with the provisions of sub-section (1), they shall be treated either as supply of goods or supply of services as referred to in Schedule II.”
According to para 4 of Schedule II of GST Act, 2017,
(a) where goods forming part of the assets of a business are transferred or disposed of by or under the directions of the person carrying on the business so as no longer to form part of those assets, such transfer or disposal is a supply of goods by the person.
Therefore taking over of assets and liabilities of S by A is supply of goods and the same is liable to GST. However according to clause 4 (c) (i) of Schedule II of CGST Act, 2017 if the business is transferred as going concern then no GST is payable.
Regarding availing of ITC, according to Rule 41 (1) of CGST rules, 2017 "a registered person shall, in the event of sale, merger, demerger, amalgamation, lease or transfer or change in the ownership of business for any reason, furnish the details of sale, merger, demerger, amalgamation, lease or transfer of business, in FORM GST ITC-02, electronically on the common portal along with a request for transfer of unutilized input tax credit lying in his electronic credit ledger to the transferee.