LIC Receives GST Demand Order from Karnataka; Rs 1.03 Crore Penalty Imposed - A2Z Taxcorp LLP

Life Insurance Corporation of India (LIC), the state-run insurance firm, has received a Goods & Services Tax (GST) demand order from the Karnataka government. The order, issued by the Deputy Commissioner, Large Taxpayers Unit (LTU), Bengaluru, pertains to the financial year 2021-22 and includes GST, interest, and a penalty.

The penalty for the alleged violation of excess Input Tax Credit (ITC) claimed amounts to Rs 1.03 crore. LIC has the option to appeal the order before the Commissioner (Appeals), Karnataka.

Financial and Operational Impact

According to the corporation, the financial impact of the demand is limited to the GST, interest, and penalty. LIC stated that the order does not have any material impact on its overall financials, operations, or other business activities.

On the stock market, LIC shares were trading down by 0.38% at Rs 846.50 on the Bombay Stock Exchange (BSE) following the news.

Background on GST Violation

The demand arose due to LIC allegedly claiming excess Input Tax Credit (ITC) under Karnataka’s GST provisions. Excess ITC claims are considered violations under GST law, leading to demand for payment of tax along with interest and penalties.

About LIC

The Life Insurance Corporation of India (LIC) is a statutory corporation established under the LIC Act of 1956. It is India’s largest insurance company and the largest institutional investor. LIC’s primary goal is to provide life insurance and financial security to individuals, with a focus on spreading insurance widely, especially in rural areas.

Source from: https://indianmasterminds.com/news/lic-gst-demand-karnataka-itc-penalty-rs-1-03-crore-172319/