A Company manufactures Item B This manufactured item B some pieces have been given Free of Cost to some customers
Issue For the manufactured items given as Free of Cost is GST required to be charged when they are given
Kindly also note that in terms of Schedule I of CGST Act
ACTIVITIES TO BE TREATED AS SUPPLY EVEN IF MADE WITHOUT CONSIDERATION
1. Permanent transfer or disposal of business assets where input tax credit has been
availed on such assets.
If we refer to above schedule then can it be inferred that the item (being a business asset ) further the term business asset is not defined in GST law) given as FOC even with out consideration will fall in Schedule I as ITC has been availed for manufacture of the FOC item
Hence sec 17(5)(h) would not apply ie ITC need not be reversed.
Experts kindly give your views