The Life Insurance Corporation of India (LIC) has disclosed a significant tax demand and potential penalties raised by the Income Tax Department for the Financial Year 2021-22. The total demand, excluding interest, stands at ₹61,46,71,18,015. The demand relates to disallowances concerning Negative Reserve, Interest on TDS, and loss from Jeevan Suraksha Fund. LIC currently contests this assessment, stating that the financial impact is unlikely to be material to the corporation’s overall operations.
Income Tax Assessment Details Disclosed
Life Insurance Corporation of India (LIC) provided an update on a recent assessment order received from the Income Tax Department pertaining to the Financial Year 2021-22. The order covers the assessment unit relating to Income Tax Department operations. The communication was formally received by the company on March 25, 2026.
Key Financial Figures of the Demand
The total demand levied by the authorities, excluding accrued interest charges, is substantial. The breakdown of the demand, specifically concerning Income Tax, is quantified as INR 61,46,71,18,015. Furthermore, the order includes a separate demand for interest amounting to INR 9,53,25,87,935.
Grounds for Disallowance
The assessment order proposes several disallowances which constitute the basis of the significant demand. These include:
- Addition of Interim Bonus as Income
- Addition of Loss from Jeevan Suraksha Fund as Income
- Addition of Negative Reserve as Income
- Disallowance of Deduction under section 80M
- Disallowance of Interest on late deposit of TDS
Anticipated Impact on Operations
LIC has assessed the potential financial impact of these orders on the corporation’s current operations and other activities. The management has concluded that there is no material impact on the financial statements or the overall activities of the Corporation resulting from this assessment order at this stage. The company reserves the right to appeal the decision to the appropriate appellate authority.
Source: BSE
