Q. I was given as a gift a beautiful tallis, as far as kashruth goes, it is equal to the one I bought for myself. Is it better or more mehudar to continue using the one I have since I paid for it and as we know one should pay for a mitzva, or better use the new one since it looks beautiful?
A. Chaye Adam (68: 16) rules that one should not comply with a mitzva for free, but rather pay for it. As King David said to Aravnah, "No; for I will only buy it from you at a price; so that I will not offer to the Hashem my G-d burnt-offerings which I had received for nothing." (Shmuel II -24: 24). He quotes the Zohar (Terumah) who is very stringent in this principle, and warns that a spirit of impurity rides with free gifts.
Chavos Yair (232) asserts that if someone received a gift of wine for kiddush or the four sedder cups, if there is no hard feelings or embarrassment involved, he should use his own paid for wine, even if the gifted wine is better.
Similarly Mishne Berura (584: 8) quoting Mateh Ephraim rules that one should strive to receive an Aliyah LaTorah during the Days of Judgment, even if he has to pay for it, as it is better a mitzva that one paid for than a free one.
Aruch Hashulchan (O.H. 53: 23) directs to rather hire and pay a shaliach tzibur than to avail one for free.
Horav Shlomo Miller's Shlit'a opinion is that one should keep the gifted tallis for Shabbos use, since in addition to the hidur mitzva of wearing a beautiful tallis, he will comply with the mitzva of kavod and honor of Shabbos, likely also heightening and enhancing the good feelings of his bestower.
Rabbi A. Bartfeld as revised by Horav Shlomo Miller Shlit'a