Non-Returnable Gate Pass vs. Stock Transfer Invoice under GST

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Ritu Bangari (Querist)
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07 May 2024 Hello Everyone,
I have a question about transferring sample products between our two manufacturing units situated in different states.

We often need to send samples from one unit to another for testing or quality control purposes. These samples usually have a value below Rs. 50,000.

My query is: Can we use a non-returnable gate pass for these transfers, or do we need to issue a stock transfer invoice , if we issue stock transfer do we have to pay GST?

Since the sample values are below Rs. 50,000 and are meant for internal use within our company, I'm unsure about the correct procedure under GST rules.

Thank you for your help!

Best regards,
Ritu

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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07 May 2024 To qualify as a free sample, a product normally possesses the following features: a) Distributed free of cost i.e without any consideration. b) Are marked NOT FOR SALE and normally no MRP is printed.
GST not applicable in such a case.