If a taxable person transfers his business, either wholly or partly, to another, then the taxable person (transferor) and the person to whom the business is transferred (transferee) will be liable, jointly and severally, wholly or to the extent of such transfer, to pay the GST due.
If a registered taxpayer transfers his business he is allowed to transfer the matched unutilized ITC to the transferee. CONDITIONS IN WHICH ITC CAN BE TRANSFERRED
∙As per Section 18(3) of CGST Act, when there is a change in constitution of a registered taxpayer on account of sale, merger, demerger, amalgamation, lease or transfer of business with specific provision for transfer of liabilities, the said taxpayer are allowed to transfer the matched ITC as per electronic credit ledger to such transferee sold, merged, demerged, amalgamated, leased or transferred business.
∙Also, ITC can be transferred in case of death of sole proprietor to the transferee or successor.
∙a registered person shall file FORM GST ITC-02 electronically on the common portal with a request for transfer of unutilized input tax credit lying in his electronic credit ledger to the transferee.
