GIFT UNDER SALE SCHEME

[mohan sehgal]

We have floated a Quarterly scheme to our dealers ....... On an aggregate purchase of our goods amounting to ₹ 6 lakhs per quarter;we will conduct a lucky draw amongst our dealers ;who are eligible(bought goods worth ₹ 6 Lakhs) and award a Two Wheeler as a Prize to the lucky winner among the eligible dealers.

Would we able to book ITC on The GST paid on the TWO WHEELER Price..given as a gift to the dealer who has bought the fixed amount of goods within the stipulated period of time.Please note that this gift is directly related to the invoiced amount of goods.

AI Summary

Input tax credit denial for promotional gifts; recharacterise as sales incentive and reflect in invoice to seek credit.
Input tax credit is not available for goods disposed of as gifts or free samples under the GST exclusion for promotional disposals. To preserve creditability, the supplier must recharacterise transfers as sales incentives or discounts, ensure the agreement and invoice expressly record that incentive, and reassess the transaction against GST rules and relevant advance rulings.