LIC shares fall on receiving income tax demand notices worth Rs 3,528.75 crore

On January 2, LIC received a GST notice of Rs 806.3 crore

LIC shares fell one percent in early trade on January 12 as the state-owned insurer received two demand orders worth Rs 3,528.75 crore from the income tax authorities in Mumbai.

As of 10.03 am, shares of LIC were trading at Rs 833, lower by 0.12 percent.

For the AY 2012-13, 2013-14, 2014-15, 2016-17, 2017-18, 2018-19 and 2019-20, the Income Tax Department has issued an intimation for a refund of Rs 25,464.46 crore, following an order from Income Tax Appellate Tribunal (ITAT).

The Income Tax Appellate Tribunal (ITAT) had directed the assessing officer to examine LIC’s utilization of surplus, related to an interim bonus mentioned in the assessment order. After reconsideration, the assessing officer disallowed the interim bonus, leading to a tax effect of Rs 2,133.67 crore.

Similarly, for AY 2015-16, LIC has been issued a demand notice for Rs 1,395.08 crore. The Life Insurance Corporation of India will file an appeal before the Commissioner (Appeals), Mumbai, against the said orders.

There is no material impact on financials, operations or other activities of the corporation, according to LIC.

On January 2, LIC received a GST notice of Rs 806.3 crore from the Maharashtra deputy commissioner of state tax for various compliance-related shortcomings in FY 2017-18. The demand notice includes Rs 365.02 crore of GST dues, Rs 404.7 crore of penalty, and an interest payment of Rs 36.5 crore.

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