itc on gifts to customers

Originally posted by : Tarun Motiani
	thank u all for information but why is Mr. Raja P M has different opinion

Yes. Two options have for the Free/Sample items...

1. You don't take ITC for the purchase of Free goods.

Ex: If you purchase 10 nos of item - A its tax value Rs. 100. You ll be take ITC for the purchased goods. Now, You ll be give 1 item to free/sample. Then you can reverse tax value Rs. 10. So, You can't take ITC.

2. you ll be pay Tax for the Free/Sample items like

Ex: You give Item A to customer for Free then you can pay the particular item tax portion to Govt...