Credit of GST for Airconditioner given for acheiving Target

[JATIN SHAH]

We have issued a scheme that if a distributors achieves sale of 10 lacs we will give him Air conditioner. co. is situated at Maharashtra and distributor is in Karnataka. if we buy AC from Karnataka with bill in the name of Company in Maharashtra can we claim credit in GST in Maharashtra.

AI Summary

GST Input Tax Credit Not Available for Air Conditioners Given as Post-Sale Incentives Under Section 17(5)(h) CGST Act. A company in Maharashtra initiated a sales incentive scheme, offering an air conditioner to distributors in Karnataka who achieve sales of 10 lakh. The query concerned whether GST input tax credit (ITC) could be claimed on the air conditioner purchased in Karnataka. Experts clarified that under Section 17(5)(h) of the CGST Act, 2017, ITC is not available for goods given as gifts or free samples. The air conditioner, considered a post-sale incentive rather than a discount, does not qualify for ITC. Additionally, GST paid in Karnataka cannot be claimed in Maharashtra.