TaxTMI 
TaxTMI 
2023 (3) TMI 1114
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....ntegrated Goods and Services Tax Act, 2017 (IGST Act), holding certificate of registration issued thereunder bearing GSTIN: 29AAJCP9958L1ZA, in the State of Karnataka, engaged in the business of "providing/supplying engineering services primarily relating to semi-conductor services". 2.1 The Applicant has entered into business transfer agreement dated 27th June, 2022 (sale agreement), in writing on a stamp paper of requisite value at Bengaluru, with M/s Tessolve Semiconductor Private Limited, a private limited company incorporated under the Indian Companies Act, 2013, having its registered office and principal place of business, at No. 31/2, Phase-II, Electronic City, Bengaluru-560100, (buyer), a person registered under the CGST, SGST and IGST Acts, in the State of Karnataka and holding certificate of registration issued thereunder bearing GSTIN: 29AABCT9789M1Z7. 2.2 The Applicant submits that in terms of the aforesaid "Business Transfer Agreement / Business Sale agreement" it has sold the independent running business of "providing/supplying engineering services primarily relating to semi-conductor services", along with all the assets and liabilities as a whole as a going concern....
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....of the independent running business divisions of the Applicant, namely, "business of providing/supplying of engineering services primarily relating to semi-conductor services", when read as a whole, it establishes that the said agreement envisages transfer/sale of the said business divisions as an ongoing running business as whole, along with all the assets and liabilities thereof to M/s Tessolve Semiconductor Pvt. Ltd., Bengaluru, and therefore, it is "slump sale", not involving any element of supply of goods or services or both for the purposes of CGST, SGST and IGST Acts. Copy of the above agreement is submitted by way of Annexure-1. 4.2 That as is evident from the Annexure-1, the instrument of transfer/sale of ongoing running business shows that the consideration for the said transfer/sale of business, is "lump sum" and not vivisected by reference any movable or immovable assets or intangible and tangible assets and services, etc., where the assets and liabilities are transferred as whole on-going concern basis which enables the business to run independently. 5. Applicant's Interpretation of Law: 5.1 The applicant contends, as per their understanding and bona fide belief....
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....s in the KGST Act. 8. We have considered the submissions made by the applicant in their application for advance ruling. We also considered the issues involved on which advance ruling is sought by the applicant and relevant facts along with the arguments made by the applicant & the submissions made by their learned representative during the time of hearing. 9. The applicant has two independent business verticals i.e. Research & Development of Semiconductor chips and Staffing business. The applicant entered into a business transfer agreement on 27.6.2022, with M/s Tessolve Semiconductor Pvt. Ltd., Bengaluru, for transfer of staffing business along with assets and liabilities. The corporate office is located at Tiruchirappalli, Tamilnadu-620021 and the staffing business division is located at HSR Layout, Bengaluru-560102. The applicant intends to sell the staffing division by raising an invoice and thus filed the instant application. The applicant contended that the said agreement envisages transfer/sale of the said business division as an ongoing running business as whole, along with all the assets and liabilities thereof to M/s Tessolve Semiconductor Pvt. Ltd., Bengaluru, and ther....
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....i) for a consideration by a person (iii) in the course or furtherance of business. Now we proceed to examine whether the impugned activity satisfies the aforesaid three limbs., 12. The activity of the applicant in the instant case is transfer of staffing business, which is one of the form of supply of goods or services or both, agreed to be made by the applicant and thus the first limb is fulfilled. Further the impugned transaction (supply) is admittedly for a consideration, to be received in multiple stages with a performance guarantee and sharing of revenue and thus the second limb also is fulfilled. The applicant intend to sell the staffing business in the course of his business and thus the third limb also is fulfilled. In view of the foregoing the activity of the applicant amounts to or results in supply in terms of Section 7 of the CGST Act 2017. 13. Now we proceed to examine the second question i.e. whether the impugned supply is of goods or services or both. Also the applicant sought ruling on the time of supply, value of supply and the rate of tax thereon. In this regard we invite reference to the definitions of 'goods' and 'services' under the CGST....
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....he date of issue of invoice by the supplier, if the invoice is issued within the period prescribed under section 31 or the date of receipt of payment, whichever is earlier; or (b) the date of provision of service, if the invoice is not issued within the period prescribed under section 31 or the date of receipt of payment, whichever is earlier; or (c) the date on which the recipient shows the receipt of services in his books of account, in a case where the provisions of clause (a) or clause (b) do not apply: Provided that where the supplier of taxable service receives an amount up to one thousand rupees in excess of the amount indicated in the tax invoice, the time of supply to the extent of such excess amount shall, at the option of the said supplier, be the date of issue of invoice relating to such excess amount. Explanation.-For the purposes of clauses (a) and (b)- (i) the supply shall be deemed to have been made to the extent it is covered by the invoice or, as the case may be, the payment; (ii) the date of receipt of payment! shall be the date on which the payment is entered in the books of account of the supplier or the date on which the payment is credited to his ....
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....Other financial services (except investment banking, insurance services and pension services. Thus the impugned transaction being a financial service it gets covered under SAC 997119. The rate of GST applicable on the impugned transaction is 18%, in terms of Entry No.15(vii) of the Notification No.11/2017-Central Tax (Rate) dated 28.06.2017, as amended. 17. Now we proceed to examine the third question i.e. whether the recipient i.e., the purchaser/transferee of the business as a whole is entitled to claim the credit of the "input tax" paid on the said transaction, if the answers to the First and Second questions are in affirmative. It is observed on examination that the question is about the entitlement of the input tax credit by the recipient of the service. In this regard we invite reference to Section 95(a) of the CGST Act 2017 which stipulates that the questions, on which advance rulings can be sought by the applicant, have to be in relation to the supply of goods or services or both being undertaken or proposed to be undertaken by the applicant. In the instant case the third question is not related to the supply of the applicant but about the entitlement of the input tax cred....