Taxpayer is required to reverse input tax credit on inputs consumed in dye intermediates (which is also a finished goods), where such goods have been destroyed in fire.
Input tax credit— In this case, a moot point is to be decided regarding reversal of Input Tax Credit on inputs consumed in dye intermediates (which is also a finished goods) that was lying in stock and got destroyed in fire.
held that— we find that since the said inputs and capital goods have been used in manufacture of finished goods that have been destroyed, the same are not used in course or furtherance of business. We, therefore, hold that the Input Tax Credit taken on the inputs used in the manufacture or production of goods i.e. intermediate dye and the Input Tax Credit taken on input services used in or in relation to the manufacture or production of said goods shall be reversed.