Alerts & Updates 31st Jan 2023

Transfer of business as a going concern – Reversal of ITC be done away with


Jignesh Ghelani Partner | Mumbai

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A common method of business re-organization is where an entity transfers its business vertical on a ‘going concern’ basis to another entity which will continue its operations.

Against this backdrop, Jignesh Ghelani, Partner and Navaz PC, Principal Associate at Economic Laws Practice (ELP) have co-authored an article for TIOL PRIVATE LIMITED, titled ‘Transfer of business as a going concern – Reversal of ITC be done away with’. In this article, the authors discuss the GST implications on transfer of business as a going concern qua input tax credit (“ITC”). The article draws out a difference between transfer of business and transfer of individual assets. The authors further lists certain ITC related issues which may arise in the case of transfer of business as a going concern. The article concludes, emphasizing the importance of ITC related issues to be addressed and the need of making amendments to existing CGST Act or CGST Rules.

Read the detailed article here: Click here