Is assessee required to reverse the CENVAT credit availed on capital goods destroyed by fire when the insurance company reimburses the value of such capital goods inclusive of excise duty? State with relevant provisions

The issue under discussion is similar to that of CCE Bangalore vs. Tata Advance Material Ltd. 2011(271) ELT 62 where Karnataka High Court observed that the assessee had paid the premium and covered the risk of the capital goods and when they were destroyed, the assesssee was compensated. The High Court held that merely because the insurance company paid the assessee the value of goods including excise duty paid would not render the availing of CENVAT Credit wrong and thus Excise Department cannot demand the reversal of credit of the said amount from the company. Accordingly, the assessee is not required to reverse the CENVAT credit availed on the capital goods destroyed by fire.