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GST ON CLOSURE OF BUSINESS

NISHANT SHAH (Tax Practioner) (230 Points)

01 April 2021

A person registered in GST as composition dealer wants to surrender his GST registration as his turnover in previous year is less than 40.00 lakh. I want to know that whether he has to pay GST on stock as on date or not? If yes then at what rate of tax? or if not then why?

please guide

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3 Replies

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 01 April 2021

Yes, gst on input stock shall be paid to government
As per Section 29(5) of CGST Act, every registered person whose registration is cancelled shall pay an amount, by way of debit in the electronic credit ledger or electronic cash ledger, equivalent to the credit of input tax in respect of inputs held in stock and inputs contained in semi-finished or finished goods held in stock or capital goods or plant and machinery on the day immediately preceding the date of such cancellation or the output tax payable on such goods, whichever is higher, calculated in such manner as may be prescribed.

Mohanraj J (1162 Points)
Replied 02 April 2021

Sourav Bhai, what are the procedures to apply available GST refund for closure of business? how many days will take to get refund? DD or NEFT ? Is it possible to transfer available refund to new entity if am partner for that new entity?
pls assist me bhai

CA. Sourav Sarkar (Chartered Accountant ) (24578 Points)
Replied 18 April 2021

Procedure for getting GST refund is.

File for GST RFD 01 along with the required documents in Annexure 1 to the form.

2. The assessee shall receive an acknowledgement in GST RFD 02 if there are no problems with the application in GST RFD 01. In case of any issues, it will be communicated in GST RFD 03.

3. The Proper Officer may pass an order in GST RFD 04 sanctioning the amount due within 7 days from the date of the acknowledgement if the Proper Officer is prima facie satisfied.

4. The Proper Officer shall pass an order for refund in GST RFD 06 and issue a payment advise in form GST RFD 05 post which the amount automatically gets credited to the bank account of the registered person.

5. The order has to be passed within 60 days from the date of receiving a complete application.

6. In case of export supplies, the Act also provides for a provisional refund of 90% of the refund claim within 7 days of the date of the acknowledgement provided the supplier was not prosecuted in the 5 years immediately preceding the refund period.

Refund might not be transferred.