LIC Faces Hefty GST Demand in Maharashtra

Life Insurance Corporation of India has received a demand notice of Rs 479.88 crore for short payment of GST in 2020-21. The notice, from Maharashtra's Deputy Commissioner of State Tax, includes interest and penalty due to ITC mismanagement and short tax payments. LIC plans to appeal the decision.

Life Insurance Corporation of India (LIC) announced on Thursday that it has been issued a demand notice by the Maharashtra State Tax Department. The notice cites a shortfall of Rs 479.88 crore in GST payments for the financial year 2020-21.

According to LIC's regulatory filing, the demand includes a breakdown of GST shortfall amounting to Rs 242.23 crore, interest of Rs 213.43 crore for late payments, and penalties adding up to Rs 24.22 crore. This demand comes from the Deputy Commissioner of State Tax, Mumbai, and was received by the corporation on February 27.

The notice relates to improper availing and reversal of Input Tax Credit (ITC), leading to a short tax liability payment. LIC has stated that there is no significant financial impact on its operations or other activities and that it plans to challenge the order with the Joint Commissioner of State Tax (Appeals) in Mumbai.