Supply under GST- The present application has been filed by the applicant seeking an advance ruling in respect of the following question.
1. Whether the transaction of transfer of business by way of merger of two GST registrations/ distinct persons would constitute ‘supply’ under the GST law?
2. Whether the transaction of transfer of business by way of merger of two GST registrations/ distinct persons would constitute ‘supply of goods’ under the GST law?
3. Whether merger between distinct persons would qualify as ‘transfer of business as going concern’ under the purview of GST Law?
4. Whether the transaction of transfer of business by way of merger of two GST registrations/ distinct persons would constitute ‘supply of services’ under the GST law?
5. If the transaction qualifies as ‘supply of services’, whether the said transaction would get covered under SI. No. 2 of Notification no. 12/2017-C.T. (R) dated 28.06.2017, and therefore not liable to GST?
6. Whether Nagpur registration can file Form GST ITC-02 and transfer unutilized credit balance to Akola registration?
7. In case the Applicant merges the business of Akola registration, then can the Applicant claim credit balance appearing in Akola registration via Form GST ITC 02A in Nagpur registration?
M/s Crystal Crop Protection Limited, the Applicant, has two GST registrations in the State of Maharashtra.
The Applicant wishes to merge both the GST registrations by way of transfer of the business of Nagpur registration with Akola registration (without consideration) and continue with one registration only and has submitted that the impugned merger transaction, as a going concern, is a supply of services and have quoted provisions of the GST Laws to support their contention.
In the subject case, M/s Crystal Crop Protection Limited, Nagpur and M/s Crystal Crop Protection Limited, Akola, as units are holders of the same PAN and they are merely distinct persons. Hence, the case at hand doesn’t qualify to be a “going concern to another person” as units are holders of the same PAN and they are merely distinct persons.
Hence, the provisions of Para 4 (c) of Schedule II of CGST Act, 2017 do not apply in this case. Therefore, the impugned supply will be treated only as supply of goods and therefore there is no supply of services in the instant case.
Further, in respect to the question whether, ITC-02 can be filed for transfer of ITC, the Authority held that, there was no supply of service but a supply of goods and therefore, the question of transfer of ITC would not arise.
Held that- The transaction of transfer of business by way of merger of two GST registrations/ distinct persons would not constitute ‘supply of services’ under the GST law.
Nagpur registration cannot file Form GST ITC-02 and transfer unutilized credit balance to Akola registration.