{"id":130,"date":"2019-04-08T07:28:55","date_gmt":"2019-04-08T07:28:55","guid":{"rendered":"http:\/\/raaas.com\/blog\/?p=130"},"modified":"2025-05-06T11:39:38","modified_gmt":"2025-05-06T06:09:38","slug":"clarification-regarding-transfer-of-input-tax-credit-in-case-of-death-of-sole-proprietor","status":"publish","type":"post","link":"https:\/\/raaas.com\/blog\/clarification-regarding-transfer-of-input-tax-credit-in-case-of-death-of-sole-proprietor\/","title":{"rendered":"Clarification regarding transfer of Input Tax credit in case of \u201cDeath of sole proprietor\u201d"},"content":{"rendered":"\r\n

A registered Taxpayer can apply for transfer of Matched Input tax credit that is available in the Electronic credit ledger of taxpayer to another business\/another registered taxpayer in case of transfer of business by way of merger\/demerger\/sale of business by filling of ITC declaration in FORM GST ITC\u201002<\/a>.<\/p>\r\n\r\n\r\n\r\n

But some doubts had been raised about the transfer of credit specially in the case of death of Sole Proprietor for which clarification has been asked, which are as follows:\u2010
1. Whether transfer of business due to \u201cDeath of Sole Proprietor\u201d includes in the meaning of \u201ctransfer of business\u201d for the sake of transfer of unutilized Input Tax credit to transferee of business.
2. Further clarification has also been sought for procedure regarding filling of Form GST ITC\u201002 in case of death of the Sole proprietor.
Government has issued Clarification through Circular No.\u201096\/15\/2019\u2010GST on 28th of March, 2019.<\/p>\r\n\r\n\r\n\r\n

Clarification for Point\u20101:\u2010Transfer of Business due to \u201cDeath of Sole Proprietor\u201d includes in the reason for Transfer of business for the sake of transfer of unutilized Input Tax credit to transferee of business?<\/p>\r\n\r\n\r\n\r\n

Clause (a) of Subsection 1 of Section 29 provides the reason for transfer of business which includes:\u2010<\/strong><\/p>\r\n\r\n\r\n\r\n

    \r\n
  1. Death of Proprietor,<\/li>\r\n\r\n\r\n\r\n
  2. Amalgamated with Other legal entity,<\/li>\r\n\r\n\r\n\r\n
  3. demerged or<\/li>\r\n\r\n\r\n\r\n
  4. Otherwise disposed off<\/li>\r\n<\/ol>\r\n\r\n\r\n\r\n

    As mentioned above Reason for Transfer of business clearly includes \u201cDeath of Sole proprietor\u201d. Therefore, Unutilized Matched Input tax Credit of Registered Taxpayer can be transferred to another registered entity for the reason of \u201cDeath of Sole Proprietor\u201d.<\/p>\r\n\r\n\r\n\r\n

    Conditions to be fulfilled for the transfer of Input tax credit to another registered entity due to change in ownership of business:\u2010<\/p>\r\n\r\n\r\n\r\n