Clarification on various promotional schemes under GST

Sr. No.Types of DiscountExamplesWhether considered as SupplyAvailability of ITC to supplier
1 Free Samples and


Drug samples given to dealers by pharmaceutical companiesNo.

This is not a Supply as is made without consideration.


ITC shall not be available for these goods as these are given away for free.

2“Buy one get one

free” offer

Buy one soap and get one soap freeYes.

It would be treated as Mixed/Composite Supply.


ITC will be available as it is treated as supply of two goods for the price of one.

3 Discounts

including ‘Buy

more, save more’


Get 10 % discount for purchases above Rs. 5,000/-, 20% discount for purchase above Rs.10,000 & so onYes.

Discounts offered are known before the supply hence reduced to calculate the taxable value.


ITC for such goods shall be allowed as discount is given as per GST regulations.

4 Secondary


A supplied 10000 packets of biscuits to B @10/- each. Afterwards A revalued those at Rs. 9 each and issues Credit note for Re.1 for each packet.Yes.

Discounts will not be reduced to calculate taxable value as the same wasn’t known before the supply. Credit Note will be offered in these cases.


No impact on availability or otherwise of ITC in hands of supplier as both are separate transactions.