Page 187 - GSTL_23rd April 2020_Vol 35_Part 4

2020 ] IN RE : RAJEEV BANSAL & SUDERSHAN MITTAL 513
7.3 On perusal of “sale deed dated 24-10-2019” we find that
(a) The applicant has sold the said premises situated at village-
Manoharpur, Pargana-Jawalapur, Dist-Hardwar to M/s Ronav In-
frastructure for a amount of Rs. 21.80 Crores;
(b) “Assets” include 105 flats, basement, ground floor, 1 to 6 floors of a
residential complex covering super area of 84988 sq. foot;
(c) The building is under-construction;
(d) The purchaser can use and sell the flats as per his will;
(e) The purchaser has a right to construct other building/floor in the
premises;
(f) The purchaser cannot demolish the said existing flats;
(g) The purchaser has a right to replace the name of seller in the records
of Nagar Nigam;
(h) The purchaser has to follow the procedures/provisions of law is-
sued by the competent authority time to time.
7.4 We find that the term “business” has been defined in sub-clause
(17) of Section 2 of the Act and the same is reproduced as under :
Section 2(17) of the Act “business” includes - (a) any trade, commerce,
manufacture, profession, vocation, adventure, wager or any other similar
activity, whether or not it is for a pecuniary benefit; (b) any activity or
transaction in connection with or incidental or ancillary to sub-clause (a); (c)
any activity or transaction in the nature of sub-clause (a), whether or not
there is volume, frequency, continuity or regularity of such transaction; (d)
supply or acquisition of goods including capital goods and services in connection
with commencement or closure of business; (e) provision by a club, association,
society, or any such body (for a subscription or any other consideration) of
the facilities or benefits to its members; (f) admission, for a consideration, of
persons to any premises; (g) services supplied by a person as the holder of
an office which has been accepted by him in the course or furtherance of his
trade, profession or vocation; (h) services provided by a race club by way of
totalisator or a licence to book maker in such club; and (i) any activity or
transaction undertaken by the Central Government, a State Government or
any local authority in which they are engaged as public authorities;
7.5 From the above definition of the “business” we find that the acqui-
sition of goods/services for commencement of business is covered under the said
definition. We observe that a transfer of a business as a going concern is the sale
of a business including assets. In terms of financial transaction ‘going concern’
has the meaning that at the point in time to which the description applies, the
business is live or operating and has all parts and features necessary to keep it in
operation. Thus “Transfer of a going concern’ in a simple way can be [described]
as transfer of a running business which is capable of being carried on by the pur-
chaser as an independent business. We further find that internationally accepted
guidelines (applicable to the case in hand) issued by His Majesty’s Revenue &
Customs (HRMC) to treat transfer of business as a going concern are as under :
(a) The assets must be sold as part of a ‘business’ as a ‘going concern’
(b) The purchaser intends to use the assets to carry on the same kind of
business as the seller
(c) Where only part of a business is sold it must be capable of separate
operation
GST LAW TIMES  23rd April 2020  307