MUMBAI: The Life Insurance Corporation of India (LIC), a state-owned entity, is under scrutiny as it received a Goods and Services Tax (GST) notice of Rs 806.3 crore from the Maharashtra deputy commissioner of state tax. The notice, pertaining to compliance-related shortcomings in the financial year 2017-18, comprises Rs 365.02 crore of GST dues, Rs 404.7 crore of penalties, and an interest payment of Rs 36.5 crore.
The GST authorities pointed out several irregularities, including non-reversal of input tax credit as per CGST rules 37 and 38, and failure to reverse input tax credit availed from reinsurance. Interest has been added due to delayed payments and discrepancies in the reverse charge mechanism (RCM) liability.
In response, LIC has expressed its intention to appeal the order before the commissioner, emphasizing that the financial impact on the company’s operations will be minimal.
This notice is part of a series of GST-related challenges faced by LIC across various states in the country. In September 2023, Bihar state tax officials presented LIC with a GST receipt, including interest and penalty, exceeding Rs 290 crore. The GST authorities in Jammu & Kashmir and Telangana have also raised concerns, leading to penalties and interest payments.
As LIC prepares to challenge the Maharashtra GST notice, the insurance giant aims to navigate through the complex landscape of state-wise tax demands.
