Life Insurance Corporation (LIC) of India has received a hefty GST notice from the Maharashtra deputy commissioner of state tax, imposing a penalty of ₹404 crore on the firm for various shortcomings in tax-related compliances in FY2017-2018.
The Maharashtra tax department sent LIC a GST notice of ₹806.4 crore, demanding ₹365.02 crore of GST dues, ₹404.7 crore of penalty, and an interest payment of ₹36.5 crore. This move comes shortly after LIC has received multiple notices from state governments.
According to the tax notice, LIC failed to observe multiple rules set by the state department, such as the non-reversal of input tax credit according to the CGST rules 37 and 38. The GST officials also said that LIC did not follow the reversal of input tax credit availed from reinsurance, reported Moneycontrol.
LIC is also liable to pay interests and dues on the delayed payment made with GSTR-3B. LIC also disclosed less reverse charge mechanism (RCM) liability than shown by its suppliers, the notice said.
However, LIC is planning to file an appeal in Maharashtra against the order before the commissioner. The insurance firm also said in a company filing that there will be no impact on the operations or activities of the company in view of the GST notice.
LIC facing GST notices from multiple states
{{/usCountry}}However, LIC is planning to file an appeal in Maharashtra against the order before the commissioner. The insurance firm also said in a company filing that there will be no impact on the operations or activities of the company in view of the GST notice.
LIC facing GST notices from multiple states
{{/usCountry}}Not only Maharashtra, but LIC has been facing multiple GST notices from states across India. Earlier this year, the insurance giant was served a GST notice from the Bihar government worth ₹290 crore, demanding a penalty of ₹16.67 crore.
LIC had also received a communication/demand order for the collection of GST, interest and penalty for the state of Jammu and Kashmir, the company had said in its filings. The GST authorities also imposed a fine of ₹36,844 on LIC for lower payment of taxes in October 2023, reported Moneycontrol.
Further, the government of Telangana also sent a GST notice worth ₹183 crore to LIC on December 11, 2023, including interest and penalty.