GST on Sale of Business Assets

[NARENDER YARRAGORLA]

A GST Reg Persons bought a truck for business purpose in 2019 and now he wants to sell the vehicle, if so whether the sale attracts GST or not?

[Amit Agrawal]

Subject transactions attract GST, in my ex-facie view.

[Amit Agrawal]

If you can explain reasons for your doubts or context for legal provisions involved etc., it would help answering your query better.

[Rajagopalan Ranganathan]

Sir,

As per Section 18 (6) of CGST Act, 2017 in case of supply of capital goods or plant and machinery, on which input tax credit has been taken, the registered person shall pay an amount equal to the input tax credit taken on the said capital goods or plant and machinery reduced by such percentage points as may be prescribed or the tax on the transaction value of such capital goods or plant and machinery determined under section 15, whichever is higher.

This provision is applicable if ITC on the truck purchased is availed by you. Otherwise you have to pay gst on the transation value, that is the price at which it is sold to munrelated buyer.

[NARENDER YARRAGORLA]

Thank you all for quick and clear response

AI Summary

GST on sale of capital goods requires payment linked to input tax credit or tax on transaction value. Sale of a business vehicle by a GST-registered person is a taxable supply. If input tax credit was availed on the vehicle, the seller must effect the input tax credit reversal: pay the input tax credit taken reduced by prescribed percentages or the tax on the transaction value of the vehicle, whichever is higher. If no input tax credit was claimed, GST is payable on the transaction value (sale price to an unrelated buyer).