Salvage value taxability clarified: insurers owe GST only when salvage becomes insurer property after full claim settlement. GST liability on salvage arises only when salvage vests in the insurance company. If claim settlement deducts salvage as a pre agreed deductible and ownership remains with the insured, the insurer has no GST liability on that deducted salvage. If the insurer settles full IDV without deducting salvage so that salvage becomes insurer property, the insurer must discharge GST on disposal/sale of the salvage.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Salvage value taxability clarified: insurers owe GST only when salvage becomes insurer property after full claim settlement.
GST liability on salvage arises only when salvage vests in the insurance company. If claim settlement deducts salvage as a pre agreed deductible and ownership remains with the insured, the insurer has no GST liability on that deducted salvage. If the insurer settles full IDV without deducting salvage so that salvage becomes insurer property, the insurer must discharge GST on disposal/sale of the salvage.
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