Winding up of Firm - Closing stock - Reg.
This query is : Resolved
12 March 2022
Dear Experts,
We are winding up a partnership firm doing jewellery business. The firm is not having money to pay to its partners.
Jewellery stock value : 1.11 Cr. (Business Stock)
Partners capital payable: 1.26 Cr.
The partners are ready to accept payment in goods form (Jewellery Stock).
In such case, it is not sale. It is drawing of capital by Partners in form of goods.
Is GST payable on such closing stock, being given to partners for returning their capital?
Does GST department raise any objection for doing so? (Business stock drawn by partners as drawings)
Please advise.
Best Regards,
Vijay Kumar
We are winding up a partnership firm doing jewellery business. The firm is not having money to pay to its partners.
Jewellery stock value : 1.11 Cr. (Business Stock)
Partners capital payable: 1.26 Cr.
The partners are ready to accept payment in goods form (Jewellery Stock).
In such case, it is not sale. It is drawing of capital by Partners in form of goods.
Is GST payable on such closing stock, being given to partners for returning their capital?
Does GST department raise any objection for doing so? (Business stock drawn by partners as drawings)
Please advise.
Best Regards,
Vijay Kumar
12 March 2022
Reverse ITC on the stock and pay GST on the reversal.
Distribute the stock to partners towards capital no GST payable in such a case.
Distribute the stock to partners towards capital no GST payable in such a case.
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12 March 2022
thanks for prompt reply sir
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