Clarification on circular no 5/2012 dt 01.08.2012 of cbdt

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sunny (Querist)
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13 October 2012 Dear all

I am running a pharmaceutical company.

We usually give free samples of medicines to doctors.

Pl confirm whether theses samples are also covered under "freebies" as per circular no 5/2012 dt 01.08.2012 of CBDT ?

Further we also give free gift as scheme to our stockist and retailers.

Pl confirm whether gift to stockist or retailer is also inadmissible as per circular no 5/2012 dt 01.08.2012 of CBDT ?

Rajagopalakrishnan R

Rajagopalakrishnan R (Expert)
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14 October 2012 Normally Free samples are given to Doctors to introduce a new product, packaging or dosage by Pharma co's. However, of late, companies are seen giving costly medicines as samples to doctors who may use it for commercial gain - eg give it to patients at reduced rates etc and derive sme profit out of these. I would not be surprised if the assessing officer treats this also as freebies especially costly samples. But a queston will always arise as to how to keep track of free samples given to each doctor. is there any statutory requirement under durg control to keep such a record.

Coming to the second point, the circular clearly is based on the MCI decision of 2009 regarding acceptance of freebies and favours by medical practitioners from Pharma Co's. As such this circular cannot be made applicable to any gifts and schemes given to stockists and dealers.

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CA MANOJ GUPTA

CA MANOJ GUPTA (Expert)
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14 October 2012 TOTALLY AGREE WITH CA RAJAGPALAKRISHNAN
CA MANOJ GUPTA
JODHPUR
09828510543

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