Availment of Import Credit (IGST)

[SURYAKANT MITHBAVKAR]

We have manufacturing of Pharmaceutical Machinery & Equipment registered under GST Act. We have imported free bottle sample from our customer for machine trial purpose. Customer has shipped bottle sample declaring a value. While clearing the material, our custom authority has charged us Custom duty, IGST on assessable value declared by our customer.

Our query is that can we avail IGST credit in above case since we are not paying any material cost to our customer. It is free of cost however we have paid custom duty & IGST as Charged by our custom department for clearance of the Goods (Sample).

AI Summary

Input tax credit eligibility: IGST charged on imported free samples may be claimable if statutory credit conditions are met.
The issue is whether IGST charged at import on free samples used for machine trials qualifies as input tax credit. One line of reasoning treats IGST on import as expressly included in the statutory definition of input tax and available if the general credit conditions are met. An opposing line contends that absent consideration the movement is not a taxable supply and IGST paid at import should be treated as a customs cost or be barred by blocked-credit rules for disposals and samples.