LIC Receives GST Demand Notice of Rs 806 Crore; Plans to Appeal the Order

Life Insurance Corporation of India (LIC) has disclosed that it recently received a notice for GST payment, along with interest and penalty, totaling Rs 806 crore. The notice, received on January 1, pertains to GST for the fiscal year 2017-18. LIC has been directed to pay Rs 3,65,02,67,702 as GST, accompanied by a penalty of Rs 4,04,77,06,418 and interest amounting to Rs 36,50,35,206, resulting in a cumulative demand of over Rs 806 crore.

In response, LIC stated that it plans to file an appeal before the Commissioner (Appeals), Mumbai, within the prescribed timelines. The corporation clarified that this demand, specific to the state of Maharashtra, is not expected to have a significant impact on its financials or operations.

The notice was issued based on identified violations, including the non-reversal of Input Tax Credit under rules 42 and 43 of CGST Rules, 2017; reversal of ITC availed from reinsurance; interest on delayed payment recorded with GSTR-3B; interest on advance (proposal deposit) received; and a discrepancy in RCM liability disclosed in GSTR-9/3B compared to the suppliers' records in GSTR-1.

Zomato recently disclosed that it received a notice from the Directorate General of GST Intelligence, inquiring about a potential tax liability of Rs 401.70 crore, along with interest and penalty. The notice was related to the delivery charges collected by Zomato from customers. In response, Zomato asserted that it does not believe it is obligated to pay any tax, as the delivery charge is collected on behalf of the delivery partners.

Similarly, it has been reported that Swiggy, a competing food aggregator platform, has also received a comparable GST notice for a tax amount of approximately Rs 350 crore.

Also Read: GST Collections Approach Rs1.65 Trillion in December 2023

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