AI Drafter 
TaxTMI 
TaxTMI 
2020 (4) TMI 593
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....e of dhoop from a third party vendor? ii) As part of the Sales Promotion campaign, the tax payer offers their distributors target based monetary and non-monetary incentives. Can they avail credit on the nonmonetary incentives like say Pressure Cooker on purchase of 1,00,000 Agarbatti Packets? Can this qualify as supply of goods to the distributor? iii) The tax payer offers one unit of Agarbatti free on purchase of 1 Carton Box full of Agarbatti. Can credit of the Agarbatti given free of cost be availed as credit by the tax payer? iv) The tax payer has purchased motor vehicle for transport of Director and Employees. Can credit of insurance and maintenance of these motor vehicles be availed as credit? 2.1 Stateme....
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....ary in nature and are not linked to any purchase of goods by the recipient. In the instant case, Dhoop is offered only to recipients who purchase the Agarbatti. There is a direct link between Agarbatti purchased and Dhoop offered free to the distributors. Accordingly, credit of the same should be available irrespective of whether these are manufactured or procured from a third party Target based non-monetary discounts on achieving specific target Target based non-monetary discounts are issued based on the schemes floated in advance during the year. The distributor pushes the sales of the product based on the incentive he would receive by achieving certain quantity of sales. Instead of offering monetary discounts which do not have a la....
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....n the target achieved by the latter in the form on issuing certain products. There is no supply of these products as these are arising out of prior contracts and such offering of products does not involve any fresh consideration. iii) Section 17(5) (a) does not allow credit on Motor Vehicles but does not restrict credit on insurance and car servicing charges. Given that the expenses are used in relation to business, the credit of the same should be available to the applicant. Additionally, credit on life and health insurance is specifically disallowed unless provided for under any obligation under any law for the time being in force. But credit on premium paid on motor vehicles is not expressly disallowed and these are obtained und....
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....n case of question 4(mentioned at Sr. no. 14 of the application of the applicant) as per Section 17(5) (a) of the Central Goods & Service Tax Act, 2017. 4. We have gone through the submission of the Applicant and also the comments given by the jurisdictional Commissionerate in the matter. 4.1 Section 17(5)(h) of the Central Goods and Service Tax Act, 2017 is reproduced below : "Apportionment of credit and blocked credits. - (1) Where the goods or services or both are used by the registered person partly for the purpose of any business and partly for other purposes, the amount of credit shall be restricted to so much of the input tax as is attributable to the purposes of his business. ----- ---- ....
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....een persons (including the driver), except when they are used for making the following taxable supplies, namely :- (A) further supply of such motor vehicles; or (B) transportation of passengers; or (C) imparting training on driving such motor vehicles; (aa) vessels and aircraft except when they are used - (i) for making the following taxable supplies, namely :- (A) further supply of such vessels or aircraft; or (B) transportation of passengers; or (C) imparting training on navigating such vessels; or (D) imparting training on flying such aircraft; (ii) for transportation of goods; (ab) services of general insurance, servicing, repair and....