ITC-02 is a crucial form for transferring the Input Tax Credit (ITC) between GSTINs during mergers and acquisitions. This form enables the smooth shift of unutilized ITC in the electronic credit ledger from one business entity to another.

Understanding ITC-02 and Its Purpose
Form GST ITC-02 is a declaration for ITC transfer in scenarios like business sales, mergers, or demergers. The responsibility falls on the transferor to submit this form, while the transferee must respond accordingly. Although the Act or Rules do not state a specific deadline, comprehensive knowledge of the GST treatment can be gained from resources like "GST on the Transfer of Business."

Importance of Filing ITC-02
Post-GST implementation, various business structural changes have occurred. In these cases, transferring unused ITC from the transferor's electronic credit ledger to the new business is possible only through filing GST ITC-02. This transfer ensures that 100% of input tax credit claims benefit the working capital of the transferee.

Structure of ITC-02
The format includes:
1. Basic details: GSTIN, trade name, and legal name of both parties.
2. ITC transfer specifics: Amount of ITC available and intended for transfer under key headings.
3. Certification: Information of the certifying Chartered Accountant (CA) or Cost Accountant.

Prerequisites for Filing
1. Both parties must have valid GST registration.
2. The transferor must possess ITC in the electronic credit ledger.
3. All GST returns from previous periods must be filed by the transferor.
4. Finalization of all merger-related transactions and liabilities.
5. Business transfer should include liability provisions certified by a CA or Cost Accountant.

Steps in the ITC-02 Filing Process

• Transferor Actions:
  - Log into the GST Portal.
  - Navigate to Services > Returns > ITC Forms to access ITC-02 and click "Prepare Online."
  - Fill in transferee details, updating GSTIN and the ITC amount per major head, and review auto-populated ITC from the ledger.
  - Provide certification details from a CA or Cost Accountant and upload the certificate. Save the form.
  - File the form using EVC or DSC, confirm with OTP, and finalize the submission.
• Transferee Actions:
  - Access Services > User Services > ITC-02 Pending for Action on the GST Portal.
  - View details via ARN and choose to accept or reject the transfer.
  - On acceptance, confirm and file with DSC or EVC. Verify the status change in ITC-02 Pending for Action.