Transfer of credit on sale, merger, amalgamation, lease Means

What is Transfer of credit on sale, merger, amalgamation, lease under GST

 

The details about Transfer of credit on sale, merger, amalgamation, lease under GST are explained here

Transfer of credit on sale, merger, amalgamation, lease or transfer of a   business.

Transfer of credit means transfer input tax credit balance to another person in case of sale of business.

  1. A registered person shall, in the event of sale, merger, de-merger,  amalgamation,  lease  or transfer or change in the ownership of business for any reason, furnish  the  details  of  sale, merger, de-merger, amalgamation, lease or transfer of business, in FORM GST ITC-02, electronically on the common portal along with a request for transfer of unutilized input tax credit lying in his electronic credit ledger to the  transferee:

Provided that in the case of demerger, the input tax credit shall be apportioned in the ratio of the value of assets of the new units as specified in the demerger   scheme.

  1. The transferor shall also submit a copy of a certificate issued by a practicing chartered accountant or cost accountant certifying that the sale, merger, de-merger, amalgamation, lease    or transfer of business has been done with a specific provision for the transfer of    liabilities.
  2. The transferee shall, on the common portal, accept the details so furnished by the transferor and, upon such acceptance, the un-utilized credit specified in FORM GST ITC-02 shall be credited to his electronic credit ledger.
  3. The inputs and capital goods so transferred shall be duly accounted for by the transferee in his books of account.

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