Shalom, I was recently told that there is a custom to throw the motzi challa to ones guests at the Shabbat table. If this is true kindly elaborate on its merits and origin. In addition I was always under the impression that one should place it before another person but not give it into their hand.

Bread is not supposed to be passed from hand to hand as this is associated with mourning. Bread should also not be thrown as this is disrespectful. The proper custom is to pass the bread and place it on the plate or on the table in front of the person who will eat it (see Shulchan Aruch Orach Chayyim 167 18 and Mishna Berura 167 88- 90).