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Insurance claim on goods damage in transit (Sales), Goods and Services Tax - GST

Issue Id: - 115191
Dated: 16-7-2019
By:- Yatin Bhopi
Insurance claim on goods damage in transit (Sales)

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We have supplied goods on door delivery basis, but goods were damaged in transit due to accident. Now we are submitting our insurance claim GST paid by us. Please share your views on below queries.

1. Are we need to claim GST also? (Rs. Taxable value ₹ 100+ GST ₹ 18 = ₹ 118)

2. let know how to treat GST in returns and books

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Posts / Replies

Showing Replies 1 to 8 of 8 Records

1 Dated: 16-7-2019
By:- Mahadev R

Claiming the entire amount of ₹ 118 is ideal as ITC on damaged goods could be disallowed.

2 Dated: 16-7-2019
By:- Alkesh Jani


In my view, as goods are damaged in transit, goods will be returned back. In books of account it will as returned (damage) goods. In this case, insurance can be claimed for value of goods only and not for GST, as GST is leviable on supply, here it cannot said that goods are supplied and also it is not received by the recipient. Moreover, in this case, we can say that transaction is not completed.


With regards

3 Dated: 16-7-2019
By:- Ganeshan Kalyani

Insurance claim is allowed for goods only. ITC claimed should be reversed. When you account for the return in the books credit the tax component in the GST receivable account.

4 Dated: 17-7-2019

Goods were damaged before the completion of supply. So it can be said that goods were damaged at the hands of supplier.No right of claiming the element of GST from Insurance Company. Rightly advised by Sh.Alkesh Jani Ji and Sh.Ganeshan Kalyani Ji.

5 Dated: 17-7-2019
By:- Yatin Bhopi

Thanks for sharing your views,

We are liable to reverse the ITC availed on damage or lost goods as per section 17(5)

In this case can we claim this ITC reverse amount from insurance company since this is loss to us.

6 Dated: 17-7-2019

In our view, yes, you can claim from insurance company the amount of ITC which was either reversed or not claimed by you in this transaction. However, you need to show them the relevant provision under Section 17(5) of the CGST Act to the Insurance company.

7 Dated: 17-7-2019

Now two issues are involved :

(a) GST paid on finished goods.

(b) GST paid on inputs contained in finished goods.

Yes, you can claim the amount of ITC contained in the finished (damaged) goods from Insurance Company inasmuch as there is no provision for remission of tax paid on finished (damaged) goods in GST Acts. You will have to intimate about the insurance claim (inclusive of GST paid on inputs) to your jurisdictional GST Range Officer.

8 Dated: 17-7-2019
By:- Ganeshan Kalyani

In nutshell double benefit cannot be taken. That is for sure. I mean either input tax credit can be taken or insurance claim can be sought.


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