Transfer of Business

[Kaustubh Karandikar]

XYZ (Proprietor) is registered with GST.

1) Owning Sweet and Namkeen Shops and Manufacturing Factory of Sweets and Namkeen.

2) Owning Commercial Premises given on rent. On both activities XYZ is charging GST. Now, the Sweet and Namkeen activity to be converted from Proprietor to Private Limited Company and the Commercial Premises will continue to be in the name of Proprietor. Whether XYZ can claim the exemption from paying GST as available under Notification No. 12/2017 CT (Rate) i.e. Services by way of transfer of a going concern, as a whole or an independent part thereof, as the entire business is not transferred and renting business will remain with XYZ?

AI Summary

GST Exemption for Sweet Shop Transfer as Going Concern Confirmed Under Notification No. 12/2017 CT (Rate) XYZ, a proprietor registered under GST, owns sweet and namkeen shops, a manufacturing factory, and commercial premises for rent. XYZ plans to convert the sweet and namkeen business into a private limited company while retaining the rental business. XYZ inquired about claiming a GST exemption under Notification No. 12/2017 CT (Rate) for transferring a going concern. Respondents confirmed that the exemption applies if the transfer qualifies as a going concern, with necessary legal documentation. All assets and liabilities of the sweet shop business must be transferred to qualify as a going concern, exempting it from GST.