Transfer of Going Concern

[Kaustubh Karandikar]

XYZ (Proprietor) is converting his business from Proprietor to Private Limited Company as a ‘Going Concern’. As per Notification No. 12/2017, there is un - conditional exemption from payment of GST for Services by way of transfer of a going concern, as a whole or an independent part thereof.

1) Whether XYZ is required to prepare ‘Bill of Supply’ at the time of transfer of business?

2) What should be the value to be shown on the ‘Bill of Supply’ since no consideration is received by XYZ?

AI Summary

Transfer of going concern exempt under GST; bill of supply required and value recorded at books of transferee.
Notification No. 12/2017 exempts services by way of transfer of a going concern from GST, treating such transfer as a singular service. Contributors advise the transferor should issue a Bill of Supply and record the transaction value as the value taken in the transferee's books (net book value). Unutilized input tax credit may be transferrable and the transferee is treated as a taxable person; valuation issues between related parties and goodwill require separate income tax/valuation consideration.