LIC Faces Over ₹600 Crore GST Demand From Maharashtra State Tax Authorities; Shares Fall 1.24%

The Life Insurance Corporation of India (LIC) on Thursday (August 29) announced through a regulatory filing that the company has received a GST demands issued by the state tax authorities of Maharashtra. Before this, the company on August 28, in the exchange filing, said that it had received a demand order from the Deputy Commissioner of the Directorate of GSTO-5 in Bengaluru, Karnataka.

Maharashtra’s GST Demand

In the regulatory filing, the company said that it had received a demand notice from the the Deputy Commissioner of State Tax, Mumbai, for the financial year 2019-20.

The notice includes a hefty demand for Goods and Services Tax (GST) amounting to Rs 294.43 crore, along with an interest charge of Rs 281.70 crore and a penalty of Rs 29.44 crore.

The total amount comes to over Rs 600 crores.

The alleged violations include the wrongful availment and short reversal of Input Tax Credit (ITC) and the interest on late payments.

LIC, in the exchange filing, added, "The order is appealable before the Joint Commissioner of State tax (Appeals), Mumbai."

Karnataka’s GST Demand

Just a day earlier, on August 28, 2024, LIC received another demand order from the Deputy Commissioner of the Directorate of GSTO-5 in Bengaluru, Karnataka.

This notice pertains to a relatively smaller amount, with GST dues of INR 1.83 crore, interest of Rs  1.79 crore, and a penalty of Rs 0.18 crore for the financial year 2019-20.

The Karnataka authorities have alleged that LIC made a short declaration of outward liability and claimed ITC on blocked credit under Section 17(5).

Similar to the Maharashtra demand notice, the company added that it has decided to appeal this order before the Commissioner of Commercial Tax (Appeals) in Karnataka.

LIC share performance

The shares of the company ended the day at 1,071.00 apiece, down by 1.24 per cent.