Question8:

1. Needs clerification on entry no. 153 `Used personal and household effects` in exemption from eway bills under rule 138. What items be covered in this entry. Whether goods purchsed like LCD, Motorcycle, Car, Furniture, Building Construction Material for residence etc. for personal purposes are covered under this entry or not. Please clerify?

2. What will be the effect on closing stock under GST if business is transferred to son form his father. One thing is clear that the father has to surrender his GST No. and son applies for fresh GST registration. Whether father has to pay GST on closing stock and son has to take input tax credit on it. Please clerify?

Answer:

Point wise reply is as follow

 (1) All the goods mentioned are covered so if a consumer is purchasing from show room and carrying goods himself from showroom to house there is no need of Eway bill

 The E Way Bill will apply only if

 The sender of material is registered or the receiver of it is registered or the transporter is carrying more then 50000 value 

 In above case none of three is applied 

 Further for eway bill it is better to understand it with concept of  sender or receiver then the term Seller and buyer Because in some cases the movement of goods is done not in capacity of seller or buyer

(2) The transfer of business as a going concern is not  transfer under GST.  This fact have been concluded from the S. no. 4 part (c) of Schedule II. The same is reproduced below

4. Transfer of business assets

(c) where any person ceases to be a taxable person, any goods forming part of the assets of any business carried on by him shall be deemed to be supplied by him in the course or furtherance of his business immediately before he ceases to be a taxable person, unless'

(i) the business is transferred as a going concern to another person; or
(ii) the business is carried on by a personal representative who is deemed to be a taxable person.

On the other hand "Service by way of transfer of going concern, as  a whole or independent part thereof " is exempt under GST vide Notification No. 12/2017- Central Tax (Rate).

 Thus the father has not required to pay GST on it.

Rule 41"Transfer of credit on sale, merger, amalgamation, lease or transfer of a business" is directly applicable to your case on the basis of going concern . According to this Rule unutilised ITC in E-credit ledger  on filling of FORM GST ITC-02 will be transferred  to the Transferee e-credit ledger. .(REPLY dt. 12/2/2018)