TaxTMI 
TaxTMI 
As per section 17(5)(b)(i) of CGST Act, 2017, ITC is no allowable on supply of Food & Beverages etc., however if any business concern incurs expenses for business promotion in form of gift of dry fruits, which are to be distributed to their clients whether ITC will be available in that case?
ITC on Food Expenses incurred in connection with business promotional activities
30 Jul 2018 
5 Replies 
5257 Views Asked by
Input Tax Credit on gifts disallowed, preventing credit for food and beverage promotional items distributed to clients.
The operative legal principle is that input tax credit is not admissible where goods are written off, lost, destroyed or disposed of as gifts or free samples; this specifically covers food and beverages supplied as promotional gifts to clients, so purchasing consumable goods for distribution to customers does not convert such supplies into eligible inputs for credit. (AI Summary)
The operative legal principle is that input tax credit is not admissible where goods are written off, lost, destroyed or disposed of as gifts or free samples; this specifically covers food and beverages supplied as promotional gifts to clients, so purchasing consumable goods for distribution to customers does not convert such supplies into eligible inputs for credit. (AI Summary)