Transfer of business as a going concern or as an independent part thereof is considered a service under GST law.
The government has taken a big decision regarding not collecting GST from Adani Group. Adani Group has got a lot of relief from this. The Airport Authority of India (AAI) says that there is no proposal on the transfer of operations of the Jaipur International Airport to the Adani Group. GST will not apply. AAI had approached the Rajasthan Bench of the Authority for Advance Rulings (AAR) whether transfer of business to Adani Group was treated as supply and whether GST was leviable on transfer of property.
Transfer of business as a going concern or as an independent part thereof is considered a service under GST law. In October 2021, Adani Group has taken over the operation, management and development of Jaipur International Airport from the Airport Authority of India (AAI). The airport has been leased by the Government of India to the Adani Group for 50 years. Therefore, GST will not be recovered from Adani Group in this case.
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UP bench had given this decision
Let us tell you that the benches of Rajasthan, Gujarat and Uttar Pradesh had ruled that the business arrangement between AAI and Special Purpose Vehicle (SPV) comes under Transfer of Going Concern. Invoice generated by Airport Authority of India (AAI) for reimbursement of cost of salary/employees at Adani Jaipur International Airport Limited is a supply falling under the purview of manpower service and hence taxable at 18% under GST.
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Authority for Advance Ruling said this
According to Rajat Mohan, Senior Partner, AMRG & Associates, the Authority for Advance Ruling (AAR) has ruled that the proceeds from the transfer of carrying on the business of operating the entire airport by the Airport Authority of India are tax neutral supplies. Therefore, Adani Group will not have to pay any GST on the transfer of operations of Jaipur International Airport.