GST on insurance claim received

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..... GST on insurance claim received
Query (Issue) Started By: - KARAN VERMA Dated:- 14-1-2021 Last Reply Date:- 27-1-2021 Goods and Services Tax - GST
Got 7 Replies
GST
Sir, motor vehilce car is damaged during accident. Now, insurance company gave ₹ 3 lakhs as compensation. Whether assesse is required to pay any GST on insurance claim received ? Further, beside insurance claim, ca .....

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..... r is old for ₹ 50,000 as scrap to buyer. There is loss on sale of car ₹ 2 lakhs as per Income tax Act. Whether assesee required to pay GST on car sale ? Reply By KASTURI SETHI: The Reply: Compensation is not income and hence not consideration. Sale of old and used car as scrap is subject to GST. Reply By KARAN VERMA: The Reply: It means whatever compensation received from insuranc .....

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..... e company for damage of vehicle is exempt from GST. Kindly provide any notification or rule. Reply By KASTURI SETHI: The Reply: Every kind of compensation amount is NOT NON-TAXABLE. You will have to examine each and every case. Go deep into the definition of 'Supply' and 'Consideration' under GST. Also literal and legal meaning of the word, 'compensation'. You will not f .....

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..... ind direct and clear cut any authority on this issue. Reply By Ganeshan Kalyani: The Reply: GST is not applicable on compensation received from insurance company. Reply By KARAN VERMA: The Reply: Sir Whether we can say that insurance claim is actionable claim which is outside the purview of GST as per Schedule-III. Here are some examples of Actionable claim- 1. Claim for arrear rent. 2. .....

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..... Claim for rent to fall due in future. 3. A choice offered to repurchase the property once again. 4. Book debts or claims 5. The right to claims maintenance. 6. Claim the benefit of the contract. 7. Deposit receipt. Reply By KASTURI SETHI: The Reply: Yes. Insurance claim is actionable claim. I agree with you. Reply By KARAN VERMA: The Reply: Thank you sir for your views.
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