itc on purchases

[Madhavan iyengar]

A Company has purchased some t shirts which will be given to employees free of cost the t shirts will bear the name of the company t shirts will be worn by employees at various business events of the company

a) is ITC available on the purchase of t shirts

b) will GST be leviable on the t shirts given free of cost and if gst is levied can then ITC be claimed

AI Summary

ITC available on company T-shirt purchases; no GST on free distribution per Schedule-III, CGST Act Section 17(5)(h). A company purchased T-shirts with its logo to be worn by employees at business events. The query was whether Input Tax Credit (ITC) is available for these purchases and if GST applies when given free of cost. It was clarified that ITC is available since the T-shirts are used in the course of employment, not as gifts. GST is not applicable as per entry no.1 of Schedule-III, and the T-shirts are not considered a supply since they are used for business purposes, thus not affected by Section 17(5)(h) of the CGST Act.