Go Digit General Insurance has received an Income Tax Order dated March 25, 2026, imposing a tax demand of ₹3,84,43,19,480, inclusive of interest of ₹1,00,38,89,700, for the Assessment Year (AY) 2023-24. The adjustments primarily relate to industry-wide issues, including the disallowance of claims provisions (IBNR/IBNER) and TDS non-deductions. The company is currently evaluating legal options to appeal the order.
Receipt of Significant Tax Demand Order
Go Digit General Insurance Limited has formally notified exchanges regarding an adverse order received from the Income Tax Department. The order, dated March 25, 2026, was issued by the Assistant Commissioner of Income-Tax, Central Circle 6(2), Mumbai.
The total Income Tax Demand raised amounts to Rs. 3,84,43,19,480/-. Notably, this demand includes a substantial interest component of Rs. 1,00,38,89,700/- levied under Section 234B of the Act for the Assessment Year (AY) 2023-24.
Basis for Income Tax Adjustments
The Authority increased the company’s total taxable income based on several primary adjustments:
- Disallowance of provision for claims categorized as Incurred But Not Reported (IBNR) and claims that are Incurred But Not Enough Reported (IBNER).
- Disallowance under Section 40(a)(ia) concerning the non-deduction of Tax Deducted at Source (TDS) on certain operational expenses.
- Disallowance under Section 40(a)(i) pertaining to the non-deduction of TDS on reinsurance premium paid to non-resident insurance companies.
The company explicitly states that these disallowances predominantly stem from industry-wide issues currently under review.
Company’s Response and Financial Outlook
At this stage, the company has assessed that there is No impact on its current financial position concerning compensation or penalties. However, based on the advice received from tax advisors, Go Digit General Insurance plans to challenge this assessment.
The management intends to pursue an appeal with the appropriate Appellate Authorities or evaluate other available legal recourse against the Order. Furthermore, the company will assess and make appropriate disclosures in its financial statements as deemed necessary following further legal evaluation.
Source: BSE
