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Care Health Insurance Ltd (CHIL), a material subsidiary of Religare Enterprises Ltd (REL), has received a GST demand notice for about ₹39.5 crore, including penalty and interest.
This overall amount includes GST demand of ₹35.92 crore, penalty of ₹3.59 crore and interest.
The demand order was issued on December 30, 2023, from the Principal Commissioner Central Goods & Service Tax & Central Excise Commissionerate at Chandigarh.
Based on the advice of tax consultants, CHIL would be filing an appeal against the said order, REL said in a filing with the stock exchanges.
The Demand Order pertains to matters relating to industry-wide (life insurance) issues of non-payment of GST on the co-insurance premium accepted as follower in case of co-insurance transactions, wherein 100 per cent GST was paid by the leader on behalf of the follower during July 2017 to March 2022. Also, non-payment of GST on re-insurance commission accepted on the reinsurance premium ceded to various reinsurance companies during the period July 2017 to March 2022.
Several Indian entities — not only insurers — received GST demand notices in the last week of December 2023. These include Zomato, Hindustan Lever, Life Insurance Corporation and Nestle. Most of them have conveyed to the bourses that they would appeal against the GST demand order before the appropriate appellate forum.
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