GST reversal of on ITEMS recd from Suppliers like gold or car

[rajat solanki]

the Manufacturer gives an scheme document with terms and condition on email that upon completing certain purchases volume they would receive gold coin, cars, or trips as per Sec 15(3)(b)(ii) agreement must be present for reversing output and circular 92 says the same and 251 also that if agreement not present then no ITC to be reversed if present

First would this scheme document would be treated as agreement and if yes is ITC reversal on purchases to achieve this scheme required to be reversed proportionately

What are ingredients to treat this scheme document as an agreement

AI Summary

Promotional scheme creating 'agreement' under GST Sec.15(3)(b)(ii) can trigger ITC reversal; amendment from 1.10.2025 tightens credit rules A supplier's promotional scheme promising items on achieving purchase volumes raises whether it constitutes an 'agreement' under GST Sec.15(3)(b)(ii) triggering ITC reversal. Administrative guidance indicates a scheme in force at the time of purchase can amount to an agreement even if not in formal writing, but agreement need not be written. An amendment effective 1.10.2025 requires that where taxable value is reduced by a credit note, the recipient must reverse ITC for B2B and the supplier must pass on tax; absent those steps, tax liability cannot be reduced. Authorities may still challenge past credits via notices; promotional items treated as an obligation (not gifts) are generally eligible if conditions are met.