One of my client purchased a fixed asset before gst and claimed input tax credit and now he had sold the asset. Is he liable to pay GST if so what is the rate of tax? What would be the answer if he had not claimed input tax credit on such asset, still he needs to pay GST? Kindly clarify the same with reference to GST act

Reply—As per schedule I of CGST Act, Permanent transfer or disposal of business assets where input tax credit has been availed on such assets will be treated  AS SUPPLY EVEN IF MADE WITHOUT CONSIDERATION.

And according to para 4 of schedule II of CGST Act, where goods forming part of the assets of a business are transferred or disposed of by or under the directions of the person carrying on the business so as no longer to form part of those assets, such transfer or disposal is a supply of goods by the person. Therefore above transaction (sale of fixed asset), will be considered as supply of goods.

GST is still need to be paid even if taxpayer had not claimed ITC at the time of its purchase, the only exception for this is where such asset is being sold without consideration.

 If that asset is motor vehicle, and ITC was not claimed earlier, GST will be applicable on margin i.e. difference between sale price and w.d.v. as per income tax act (Refer notification no. 08/2018 (central tax rate) dated 25.01.2018.)