221.            ABC LLP, taxable person, is a limited liability partnership firm having following partners:

A: partner

B: partner & designated partner

C: designated partner

The LLP decided to discontinue business on 1.4.2017 & the tax liability on such date was Rs. 5 lac. After completing the formalities regarding the same, the LLP registration certificate was cancelled on 5.4.2017& the tax liability on this date is Rs. 5.2 lac. Discuss the taxability.

As per section 94(1) of the CGST Act, every partner of the firm is jointly & severally liable to pay Tax/ Interest/ Penalty due from firm upto date of discontinuation of business.

Since the tax liability of firm as on & upto discontinuation of business and there after upto the date of cancellation of registration certificate of business i.e. 5.4.2017 is Rs. 5.2 lac, the entire amount is payable by all the partners jointly and severally.