Transfer of business would qualify as a supply in GST : AAR
GST Authority of Advance Ruling order in case of M/s. Merck Life Science Pvt Ltd
Below is the extract of ruling
Question 1:- Whether applicant’s direction to the seller (directed in agreement dated 21 June 2018) fordirect transfer of BP business to MSPL and PM business to MPMPL, respectively would qualify as a ‘supply between the applicant’ and ‘MSPL/MPMP’
Answered in the affirmative as per details discussed above.
Question 2 :- If the answer to the above question is ‘affirmative’ then as the parties are related, even in absence of the actual consideration does the applicant have to attribute a notional consideration and charge CST in line with schedule 1 of CST Act to be compliant
Answer:- The value is to be determined as per Rule 28 of the CGST Rules, 2017
Question 3 :- If the answer to both the questions are ‘affirmative’ then as the recipients (MSPL/MPMPL)are eligible to avail full input tax credit then the notional consideration (percentage of the business transfer value) would be only academic and wiU the invoice value be considered as open market value
Not answered in view of answer in respect of Question 2 above.