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Taxation Maharashtra Ministry of Finance Maharashtra Goods and Services Tax Act, 2017

Reiteration of clarification on taxability of salvage/ wreck value earmarked in the claim assessment of the damage caused to the motor vehicle-reg.

04-Jul-2024 | No. JC (HQ)-5/AR-2/GST/2024/ADM-8/B-81

Government of Maharashtra has reiterated Clarification on taxability of salvage/ wreck value earmarked in the claim assessment of the damage caused to the motor vehicle.

By virtue of this notification it is clarified that in cases where due to the conditions mentioned in the contract itself, general insurance companies are deducting the value of salvage as deductibles from the claim amount, the salvage remains the property of insured and insurance companies are not liable to discharge GST liability on the same. However, in cases, where the insurance claim is settled on full claim amount, without deduction of value of salvage/ wreckage (as per the terms of the contract), the salvage becomes the property of the insurance company and the insurance company will be obligated to discharge GST on supply of salvage to the salvage buyer.

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