Seeks to provide special procedure for corporate debtors undergoing the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016

Last updated: 23 March 2020

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This notification introduces a special procedure for corporate debtors undergoing the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016. These companies, managed by interim or resolution professionals, will be treated as distinct entities and require new GST registrations in each state where they were previously registered. They must also file specific returns and have provisions for claiming input tax credit on received supplies.

[To be published in the Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i)] Government of India Ministry of Finance (Department of Revenue) Central Board of Indirect Taxes and Customs Notification No. 11/2020 Central Tax New Delhi, the 21st March, 2020 G.S.

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FAQ :

This special procedure is for corporate debtors who are undergoing the corporate insolvency resolution process under the Insolvency and Bankruptcy Code, 2016, and whose affairs are managed by an interim resolution professional (IRP) or resolution professional (RP).

The corporate debtor, managed by the IRP/RP, will be treated as a distinct person and must obtain a new GST registration in each state or union territory where they were previously registered. This new registration must be obtained within thirty days of the IRP/RP's appointment.

If the IRP/RP was appointed before this notification was issued, they must obtain the new registration within thirty days from the commencement of this notification, with the effective date being their appointment date.

After obtaining the new registration, the corporate debtor must file their first return under section 40 of the Act. This return covers the period from when they became liable for registration until the date registration was granted.

Yes, in their first return, the corporate debtor can claim input tax credit on supplies received since the IRP/RP's appointment, even if the invoices bear the previous GSTIN. Certain conditions apply, and specific provisions of section 16(4) and rule 36(4) are excluded.

Businesses receiving supplies from these corporate debtors are eligible to claim input tax credit on invoices issued using the erstwhile GSTIN for the period from the IRP/RP's appointment until the new registration date or thirty days from the notification date, whichever is earlier. Certain conditions apply, and specific provisions of rule 36(4) are excluded.