Life Insurance Corporation of India (LIC) encountered a significant setback as tax authorities issued a demand notice amounting to approximately Rs 663.45 crore. The demand, encompassing interest and penalty, was communicated by the Office of the Commissioner of CGST & Central Excise, Chennai North Commissionerate, on January 1, as confirmed by LIC in a regulatory filing.
The tax authorities' scrutiny revealed that the demand is linked to the incorrect availment of Input Tax Credit (ITC) and the non-payment of tax on turnover that was erroneously declared as non-GST supply in GSTR-1 for the financial years 2017-18 and 2018-19.
In response to the notice, LIC has announced its intention to file an appeal before the Commissioner (Appeals), Chennai, within the stipulated timelines. The corporation emphasized that this development will not exert any material impact on its financials, operations, or other activities.
This revelation comes on the heels of another demand order received by LIC on January 2, amounting to about Rs 116 crore for Telangana state. The preceding day, on January 1, LIC faced a similar notice demanding approximately Rs 806 crore for short payment of GST, along with interest and penalty, pertaining to the state of Maharashtra.
The unfolding developments underscore the challenges faced by large entities in navigating the complexities of the GST framework, with LIC actively addressing the demands and signaling its commitment to resolving these issues through appropriate legal channels.
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