Death of composition dealer

composition dealer died in may 2021 and his legal heir applied registration in regular mode how ITC of closing stock transferred to legal heir business
Replies (6)
Quick Summary
This discussion clarifies the process for a legal heir to claim Input Tax Credit (ITC) on closing stock after the death of a composition dealer. Initially, there was confusion regarding the correct form, with ITC-02 being incorrectly suggested. It's now confirmed that ITC-01 is the appropriate form under Section 18(1)(a) of the CGST Act for claiming ITC on stock when a business becomes liable for regular registration due to such circumstances.

I doubt that in this case whether you can file ITC 02 to claim ITC on stock .
Because the as the Registration was obtain on death of proprietor which was under Composition scheme.

So I can suggest that you can try & file ITC 02 .
Firstly thanks for your reply and I have a doubt ITC 02 is related to electronic ledger input how I can show input of closing stock

There is no question of input transfer snce the deceased was under composition scheme so obviously there will be no balance in e credit ledger. 

So far as the transfer of inputs held in closing stock is concerned, it is only available when you withdraw from composition scheme and convert from composition to regular. In your case the situation is different as the existing GSTN has not been converted in to regular business.

Dear Ravi
yes it was wrongly type ITC 02 instead of ITC 01

In term of Section 18(1)(a) of CGST can file ITC 01 & can claim ITC on Stock.
the section state the person liable for Registration can claim .
Sec 18(1) of the CGST Act prescribes the date when a person is entitled to take Credit in particular circumstances:-

A taxable person who has applied for registration within thirty days from the date on which he becomes liable to registration

is entitled to take Credit of input tax on the day immediately preceding the date from
which he becomes liable to pay tax under the provisions of the CGST Act.

So in above its clearly stating that the person liable for registration (whatsoever reason) can claim ITC on stock.
Thank you very much for clarifying my doubt sir

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