Stock damaged in recent floods

[CHAMANTHI BUDDAVARAPU]

Hello Sir,

I have a doubt regarding damage stock insurance claim & GST ITC. We have purchases and already input claimed at the time of purchase. But in September due floods 15 Lakh stock damaged. We are claiming insurance but insurance company said that we will consider without GST only. GST part will discuss with GST department. Please guide me what is the procedure regarding this in GST department & insurance company

AI Summary

Reversal of input tax credit required for destroyed stock; insurer should reimburse GST where ITC is reversed.
Reversal of input tax credit under Section 17(5)(h) is required for goods destroyed by flood; proportionate ITC should be reversed to match the physical quantity no longer available for sale. Partially damaged but saleable goods do not require reversal to that extent. Taxpayers should obtain a Chartered Accountant certificate confirming the reversal and present it to the insurer so the insurance claim can include the GST component without resulting in a double benefit.