NEW DELHI: The government-owned Life Insurance Corporation (LIC) of India has received Goods and Services Tax (GST) demand amounting to Rs 806 crore, the insurance company said in an exchange filing on Monday.
The total tax demand includes Rs 365 crore as GST demand, Rs 404.8 crore as penalty and Rs 36 crore as interest. The tax demand has been raised by deputy commissioner of state tax, Mumbai, Maharashtra.The tax pertains to non-reversal of input tax credit under rules 42 & 43 of CGST Act and reversal of ITC availed from reinsurance.
Besides, the demand also includes interest on delayed payment made with GSTR-3B and interest on advance (proposal deposit) received.Rule 42 and 43 of CGST says input tax credit claimed on raw material or supplies used for non-business purposes or manufacturing of exempted goods, then the input tax credit must be reversed by the taxpayer on a periodic basis.
The public sector insurer has claimed it will file an appeal before Commissioner (Appeals), Mumbai, against the said tax demand within the prescribed timelines. It further says that the tax demand will not have any material impact on financials, operations or other activities of the company.