Question90: One of my client has insured his material which was moved to Delhi from Mumbai port. Material was fully damaged on the way due to fire in the truck. Insurance claim will be settle shortly. My Question is : -
1. Should we enter purchase in our books of accounts'
2. Shall we entile to claim ITC of IGST as Material was demaged'

Answer Point wise reply to your question is as follows:
1. You should enter purchase in your books of accounts as you have actually done the purchases irrespective of the fact that material was destroyed on the way. Also the entries related to loss of stock and insurance claim received should be recorded.
2. As per section 16(1)of CGST ACT
Every registered person shall, subject to such conditions and restrictions as may be prescribed and in the manner specified in section 49, be entitled to take credit of input tax charged on any supply of goods or services or both to him which are used or intended to be used in the course or furtherance of his business
In your case since the material is not used in the course or furtherance of business, so you are not entitled to claim ITC of IGST paid. (Reply dt. 13/4/2018)