What is the proper action when a client asks you, as a designer or an agency, for the master files of the work you did for them ?

The artwork should remain your property, unless the client specifically bought all the rights. There could be legal issues to give them to the client (license on images for instance, or on fonts). You just need to make things clear in the beginning of your relationship with the client what they are entitled to and what they cannot get.

to ne honest i always provide the full source to my clients, i build each project from scratch, i dont use any clip or source already used in previous projects, and also i think in any client who looking to expand his project while i'm not avialable  why he should repay for what he already paid.

And in some times i feel this is the main reason make the clients belive in me and get back to me in another projects or expanding them project. so i try to build trust by that.

Depending upon your contract of deal with the customer , In some cases when the client asks for the raw or master files , you charge him a bit more than the normal client , and thats due to the possiblity of making these files re-usable again in any other project the client will work on.

I go with Yvan, the client should have purchase all the rights from the designer. If this is not the case then there is one more solution, Reduce the Image resolution of the PSD (source file). reduce it to72 Pixels/Inch if its a print media file or reduce it to less then72 if its a web design file