Care Health Insurance Ltd (CHIL), a significant subsidiary of Religare Enterprises Ltd (REL), has been served with a GST demand notice totalling approximately ₹39.5 crore, inclusive of penalty and interest.
This aggregate sum comprises a GST demand of ₹35.92 crore, alongside a penalty amounting to ₹3.59 crore and associated interest charges.
The notice was officially issued on December 30, 2023, by the Principal Commissioner of Central Goods & Service Tax & Central Excise Commissionerate in Chandigarh.
As per REL’s disclosure to the stock exchanges, CHIL intends to contest the order by filing an appeal, following the guidance provided by tax consultants.
The Demand Order concerns issues in the life insurance sector, specifically regarding the failure to pay GST on co-insurance premiums treated as follower amounts in co-insurance transactions. This involves cases where the leader paid 100% GST on behalf of the follower between July 2017 and March 2022. Additionally, it involves the non-payment of GST on reinsurance commission received for reinsurance premiums ceded to various reinsurance companies during the same period.
Towards the end of December 2023, several Indian entities—beyond insurers—received GST demand notices. This list includes Zomato, Hindustan Lever, Life Insurance Corporation (LIC), and Nestle. Many of these companies have indicated to the exchanges their intent to appeal the GST demand order through the appropriate appellate channels.
