GST under RCM on stamp duty

[Kaustubh Karandikar]

XYZ (Proprietory Concern) has sold its entire business to PQR Pvt. Ltd. under slump sale of ongoing concern arrangement i.e., transfer of a whole of business concern as a going concern. For this purpose, Stamp Duty paid by PQR to Govt. of Maharashtra against ‘Business Transfer Agreement’. Is PQR required to pay GST under reverse charge on the stamp duty paid under the category ‘Services provided by Govt.’?

AI Summary

Stamp Duty on Business Transfer Not Subject to GST Reverse Charge; Clarification on Government Service Exemption XYZ, a proprietorship, sold its entire business to PQR Pvt. Ltd. through a slump sale, requiring PQR to pay stamp duty to the Government of Maharashtra for the Business Transfer Agreement. The query addressed whether PQR must pay GST under reverse charge on this stamp duty. Respondents clarified that stamp duty is a tax, not a service fee, and thus not subject to GST under reverse charge. It was noted that services provided by the government, such as registration, are exempt from GST, confirming that no GST applies to the stamp duty in this transaction.