To appreciate the value of a business transmission through a break and enter, let`s take a look at the alternative: retail. Here, each asset would be valued and sold separately, each having its own counterparty. The same analysis can be done in the same way: Depreciable assets: Assuming that, since the transfer of a company or an entire company, all assets are sold within a given block. In this case, the following amount must be taxed as a short-term capital gain/loss: both the sale of assets and the sale of Slump are drafted and executed on a business transfer agreement (BTA), specifying all the details of the transaction, the names of the parties, stamp duty, transferred assets and consideration between the parties. However, it is generally recommended to use an agreement for sale instead of a deed of transport, since the stamp duty for an agreement is significantly lower than that of a transport deed. For both instruments, it is worth mentioning the individual assets and their valuation in the agreement. The valuation is carried out by a certified valuer based on the book value of the asset. Similarly, Article 5, Point g) of the Act imposes stamp duty due for an agreement to sell personal property. If the possession of personal property is delivered or agreed without the execution of a deed of transport, the stamp duty provided for by this agreement is 3% (3%) the counterparty or market value of the property, depending on the higher value. In the event that ownership of the property is not delivered, liability for the stamp is limited to 20,000 INR. In addition to these provisions, a residual clause in Section 5, point d) of the KS Act provides that any agreement that is not expressly provided for in Article 5 is duly stamped in INR for two cents. Therefore, stamp duty due to a BTA in force in the State of Karnataka depends on the structure of the BTA, whether the transport activity is carried out by the parties with respect to the personal property belonging to the company and that a company purportedly transferred under a BTA can be equated with mobile or mobile real estate.
The retail transaction will be covered as a delivery under the GST and individual assets under the definition of goods under Schedule II of the CGST Act. Calendar II covers the situation when a portion of the asset is transferred. From the discussion above, we can deduce that Slump Sale is a better alternative for the company if the business is to be transferred. But where there is only one facility or machines for sale, selling assets is the best option. In the case of the sale of property, sections 5 and 6 of the Indian Stamps Act, 1899, also apply and stamp duty is assessed on the basis of the highest value asset. For example, if the sale of land and machinery is to take place and the land with the highest value attracts the stamp duty on which it is calculated according to the scheme of the law. It is important that all rights and commitments are transferred from the transferor to the purchaser.