ICICI Prudential Life Insurance has received a show-cause cum demand notice (SCN) from the Directorate General of GST Intelligence (DGGI) for an alleged tax liability of Rs 492.06 crore. The notice pertains to the period July 2017 to July 2022.
"The matter largely relates to an industrywide issue of input tax credit, and the company believes that it has availed eligible input GST credit in compliance with the provisions of the Central Goods and Service Tax Act, 2017 and other applicable laws," the company said in an exchange filing.
The insurance provider said that it will take "appropriate steps in due course in reply to the notice and contest the matter". During the course of the inquiry, it has deposited Rs 190 crore without accepting any liability.
The DGGI is a law enforcement agency that investigates cases of tax evasion. In recent years, the DGGI has been cracking down on tax evasion in the insurance sector. In September 2022, the DGGI said that it had detected GST evasion of Rs 824 crore by 15 insurance companies, including ICICI Prudential.
The DGGI alleged that the insurance companies had availed of input tax credit (ITC) without the underlying supply of goods or services. The ITC is a tax credit that businesses can claim on the input taxes they pay on goods and services used for making taxable supplies.
The insurance companies have denied the allegations and said that they have complied with all the GST laws. The companies have also said that they have voluntarily paid Rs 217 crore to the GST authorities in connection with the investigation.
The matter is currently under investigation by the DGGI. The DGGI will decide whether to issue a final order to the insurance companies after considering their response to the SCN.
Here are some additional details about the notice
- The notice was issued on June 20, 2023.
- The alleged tax liability is for the period July 2017 to July 2022.
- The notice was issued by the DGGI's Mumbai unit.
- ICICI Prudential has denied the allegations and said that it will contest the matter.
- The company has filed a detailed response to the SCN and has provided all the relevant documents to the DGGI.
- The DGGI is currently investigating the matter.
CAclubindia
