Applicability on of GST on inter-branch transfer of capital assets

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This discussion explores whether Goods and Services Tax (GST) applies to the transfer of capital assets, such as laptops, between branches of the same company. Specifically, it addresses the transfer of capitalized laptops from a Mumbai branch to a GIFT City branch in Gujarat, where GST is exempt. While GST is applicable on the transfer from the Mumbai branch, the Gujarat branch cannot claim Input Tax Credit (ITC) due to the exemption, potentially leading to a loss of GST.

Ruchit Khimawat

Ruchit Khimawat (Querist)
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12 May 2023 Is GST applicable on inter-branch transfer of laptops from Mumbai Branch to Gujarat (GIFT CITY-IFSC) Branch?
The laptops have been capitalized in the books of accounts and the ITC on the same have been availed.
Please note that the laptops are being transferred to GIFT City of Gujarat where GST is exempt.

CA Altamush Zafar

CA Altamush Zafar (Expert)
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13 May 2023 Yes GST will be applicable on Mumbai branch.....

Ruchit Khimawat

Ruchit Khimawat (Querist)
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13 May 2023 But Gujarat branch will not be able to claim the ITC of the same as there will be no output tax liability. So it will result in a loss of GST.

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