Thomas & Sons (TS) is a partnership firm, registered under GST, engaged in manufacturing activity in the State of Rajasthan under GST and files…

Thomas & Sons (TS) is a partnership firm, registered under GST, engaged in manufacturing activity in the State of Rajasthan under GST and files return on a monthly basis. In the month of July, following transactions were undertaken by TS: (a) Intra-State sale of goods worth - 10,00,000. Out of such sale, 5,00,000 worth of goods were liable to GST at 28% and balance were liable to GST at 18%. (b) Intra-State purchase of goods worth - 10,00,000 which is liable to GST at 28%. (c) TS intended to transfer the business as going concern to Mohan & Sons (MS) on 31st July. As per the terms of transfer, TS will transfer all the business assets worth - 50,00,000 and all the liabilities valued at 20,00,000. (d) TS, on account of such transfer, paid gift worth - 50,000 to its 3 employees as a reward towards their services to the firm. During the month of September, MS received the notice from the GST Department for the outstanding liability of GST for 5,00,000 pertaining to the period before transfer of business by TS. Such liability was determined after the transfer of business. For this purpose, assume that all the assets and liabilities were transferred by TS to MS. The balance of input tax credit at the beginning of the relevant period for TS is nil. Further, subject to the information given above, assume that all the other conditions necessary for availing ITC have been fulfilled. GST is applicable on all inward and outward supplies @ 18% unless otherwise specified. (Ignore CGST, SGST and IGST bifurcation for the sake of simplicity.) All the amounts given above are exclusive of GST, wherever applicable. Based on the facts of the case scenario given above, choose the most appropriate answer to Q. Nos. 6 to 9 below, carrying 2 marks each: