ITC not available for Goods Purchased for Sales Promotion Activities under GST: Madras HC

The Madras High Court ruled that Input Tax Credit (ITC) is not available for goods purchased for sales promotion activities under GST. The court held that sales promotion activities, which include distribution of free goods or gifts, do not constitute taxable supplies under GST. Therefore, the goods purchased for such activities do not qualify for ITC. The ruling clarified that only goods used for business operations, including production and sales, can be considered for ITC claims. The decision reiterates the importance of adhering to the specific provisions under the GST regime regarding the use and eligibility of input tax credits.