On Tuesday, Bajaj Allianz received a show cause cum demand notice from the Directorate of GST Intelligence, amounting to ₹1,010 crore, for non-payment of GST on co-insurance and re-insurance premiums, as per the information disclosed by Bajaj Finserve, in a stock exchange filing.
The company is expected to respond to this show cause cum demand notice within the specified timeframe.
Bajaj Allianz General Insurance Company Limited (BAGIC), an unlisted subsidiary of the company, has received a Show Cause Cum Demand Notice from the Directorate General of GST Intelligence, the Pune Zonal unit. The notice, issued under Section 73(1) of the Central Goods and Services Tax Act, 2017, on 29 September 2023, asks for a tax demand of ₹1,010,05,80,540, the Company stated in its BSE filing.
The notice pertains to non-payment of GST in two cases from July 2017 to March 2022. This issue of GST payment on premiums has been a reason for this dispute between the government and insurance companies. The GST General Directorate Intelligence also sent similar notices to several other firms as well.
ICICI Lombard General Insurance has also received a show cause cum demand notice from the Directorate General of GST Intelligence, which is amounting ₹1,728 crore, for non-payment of tax on certain supplies between July 2017 and March 2022.
The notice sent to ICICI Lombard was also issued because of the non-payment of GST on co-insurance and reinsurance premiums.
The alleged demand and the contended show cause cum demand notice was issued because of the non-payment of GST on co-insurance premiums accepted in co-insurance transactions, as well as the non-payment of GST on reinsurance commission accepted on the reinsurance premiums granted to many Indian and foreign reinsurance companies from July 2017 to March 2022, ICICI Lombard said in its BSE filing on 27 September.
