NCLT appointed liquidator must pay GST on sale of asset of defunct company


Mansi Oils and Grains Pvt. Ltd


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The applicant wants to know whether any sale done by the liquidator of the assets of the applicant results in a supply of goods and/or services or both within the meaning of “supply” as defined under section 7 of the GST Act.


If the answer is affirmative, then what will be the rate of GST. The applicant also wants to know whether the liquidator needs to get registered under the GST Act.

AAR ruled that, “Sl No 4 (a) of Schedule II of the GST Act says, 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, whether or not for a consideration, such transfer or disposal is a supply of goods by the person.

The liquidator is appointed under section 34 (1) of IBC after NCLT initiates liquidation in terms of section 33 of IBC. As the applicant – the corporate debtor – is not a going concern, the liquidator is required to sell its assets under clauses (a) to (d) of Regulation 32 of the Insolvency and Bankruptcy Board of India (liquidation process) Regulations.

The sale of the applicant’s assets like the plant and machinery, office equipment & furniture is, therefore, a supply of goods by the liquidator. She is required to take registration under section 24 of the GST Act”.

The details of the case can be read as here :
Mansi Oils-2

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