TMI Blog2022 (12) TMI 950X X X X Extracts X X X X X X X X Extracts X X X X ..... called LoanFront which includes all the related software developed for its functionality such as Domain name, LMS software, Backend API, Websites, Analytical tools and Dashboards etc., and Business Intelligence / IP related to LoanFront application. Further clause 1.1 (k) defines the liabilities to include the Gratuity of the Employees of Rs.6,90,726/-. The statement of facts conveys that the transfer of business pertains to LoanFront app sought to be sold is a fully functional part of the business and the transaction contemplates the transfer of the entire aforesaid business to a new person (WPL), who would not only enjoy a right over the assets but shall also take over the liabilities. It thus postulates that there will be a conti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed under CGST/KGST Act 2017. The applicant own a mobile application, developed and owned by them, called as LoanFront , which is a Fintech product and is used as a digital platform to facilitate lending of short term personal loans; they intend to transfer the said mobile application software to their wholly owned subsidiary M/s Vaibhav Vyapaar Private Limited (WPL). 3. In view of the above, the applicant has sought advance ruling in respect of the following question:- a. Whether the GST would be applicable on the aforesaid transfer of mobile application software? 4. ADMISSIBILITY OF THE APPLICATION : The applicant filed the instant application seeking advance ruling on the issue of determination of the liability to pay tax on ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... utive transfer The applicant, basis above, contends that the transfer of mobile application by them to M/s WPL falls under the ambit of transfer mentioned at SI.No. 2 in Notification 12/2017-GST (Rate) dated 28.06.2017 and thus the said transfer is exempted as Services by way of transfer as a going concern, as a whole or an independent part thereof' in terms of Notification supra. PERSONAL HEARING PROCEEDINGS 7. Sri Bhavesh Jhabak, Manager Authorised Representative of the applicant appeared for personal hearing proceedings held on 18.08.2022, reiterated the facts narrated in their application and sought additional hearing. An additional personal hearing opportunity was provided on 29.09.2022, but the applicant sought adjo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carry on the business in the same manner. 11. The applicant submitted that they intend to sell an independent part of their business (Loan Front App) to VVPL along with assets liabilities and contends that transfer of business as a whole or independent part thereof amounts to supply of service; the aforesaid independent part of their business qualifies to be a going concern as the same would be continued in the hands of VVPL; the impugned business is intended to be transferred along with all the assets liabilities and hence their activity qualifies to be a service by way of transfer of a going concern, as a whole or independent part thereof and thus is exempted in terms of entry number 2 of the Notification No. 12/2017-Central ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and Dashboards etc., and Business Intelligence / IP related to LoanFront application. Further clause 1.1 (k) defines the liabilities to include the Gratuity of the Employees of Rs.6,90,726/-. 13.2 Further clause 2 of the agreement deals with the transfer of the business and clause 2.2 defines Business and its components that are intended to be transferred, which includes (i) Assets, (ii) Employees, (iii) Liabilities, (iv) Intellectual Property and (v) any other rights that the seller may have against third parties with respect to the business. 13.3 In view of the above, the statement of facts conveys that the transfer of business pertains to LoanFront app sought to be sold is a fully functional part of the business and the transacti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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