UPDATE 17(5)(h) of the CGST Act
GOODS LOST, STOLEN, DESTROYED, WRITTEN OFF OR DISPOSED OF BY WAY OF GIFT OR FREE SAMPLES; After issuance of circular no 92/11/2019-GST, a large number of judgements and also contradictory by AAAR and AAR requires further clarification by the CBIC.
|
S. No |
Nature Of Supply |
Whether ITC Available |
Whether A Supply Under GST |
Remarks |
|
1 |
Free Samples And Gift |
No |
No |
Covered by Circular No 92/11/2019-GST dated 07-03-2019. Also supported by following judgements:
Divergent view taken in the case of Orient Cement Limited TS(DB)-GST-AAR(TEL)-2023-951 AAR holds that the transaction is one of supply of goods to his dealers in exchange for consideration which is the "monitory value of the "act" of attaining a level of business indicted in the incentive scheme" and that Applicant is inducing his dealers/ stockiest to attain a particular level of business as a consideration for the goods to be supplied by him; Date of judgement 30-09-2023 |
|
2 |
Buy 1 Get 1 Free Offer |
Yes |
Yes |
It May Be a Composite Supply or Mixed Supply. Covered by Circular No 92/11/2019-GST dated07-03-2019 |
|
3 |
Discounts Including "Buy More Save More" Offers |
Yes |
Yes |
Such Discounts Are Sometimes Shown On the Invoice Itself or Maybe a Part of Terms of an Agreement. Such Discounts Are Passed On by The Supplier Through Credit Note. Covered by Circular No 92/11/2019-GST dated07-03-2019 |
|
4 |
Secondary Discounts |
Yes |
Yes |
Credit Note is issued for price difference. It Will Be Simply Financial Transaction. Covered by Circular No 92/11/2019-GST dated 07-03-2019 |
|
5 |
Finished Goods Lost In Fire Accident, Steel Scrap Sold In Open Market |
No |
No |
Geekay Wires Limited TS(DB)-GST-AAR(TEL)-2023-857 ITC required To Be reversed On Inputs. |
|
6 |
Allows ITC When Consideration Paid By Way Of Book Adjustment/ Setting-Off Book Debts |
Yes |
Yes |
Senco Gold Limited Ts (Db)-Gst-Aar(Wb)-2019-472 |
|
7 |
ITC On Goods Supplied In Marketing Events |
No |
No |
BMW India Private Limited TS(DB)-GST-AAR(Har)-2019-745 Ineligible |
|
8 |
ITC- Reversal On Inputs For Inherent Loss During Manufacturing Process 'Misconceived'; Blocked Credit Provision Inapplicable |
yes |
Yes |
ARS Steels And Alloy International Private Limited Vs. State Tax Officer TS(DB)-GST-HC(Mad)-2021-346 |
|
9 |
ITC On Inputs Consumed In Expired Cakes & Pastries Not Admissible; |
No |
No |
Kanayalal Pahilajrai Balwani TS(DB)-GST-AAR (Guj)-2021-554 Requires Reversal |
|
10 |
Denies ITC On Branch-Ho Inter-State Supplies Where Consideration Netted Off |
No |
No |
Sanghvi Movers Limited. TS(DB)-GST-AAR(TN)-2019-549 |
|
11 |
No ITC Available For Construction Of Marriage Hall Used In Furtherance Of 'Renting' Business |
No |
No |
Sree Varalakshmi Mahaal LLP. TS(DB)-GST-AAR(TN)-2019-247 |
|
12 |
Disallows ITC On Free Gifts/Trips Distributed To Dealers |
No |
No |
Surfa Coats (India) Private Limited TS(DB)-GST-AAR(KAR)-2019-668 |
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