General Insurance Corporation of India has received a tax demand notice from the Income Tax Department for ₹350.47 crore pertaining to the 2023-24 assessment year. The company maintains that this order has nil impact on its operations and financial stability. Management has announced its intention to challenge the demand by filing an appeal with the National Faceless Appeal Centre (NFAC) following consultations with tax experts within the next 30 days.
Overview of the Tax Demand
The Income Tax Department of Mumbai issued an assessment order and a formal demand notice under section 156 of the Income Tax Act, 1961, to the General Insurance Corporation of India. The total liability cited in the notice stands at ₹350,47,88,210, covering the assessment period for the 2023-24 financial year.
Details of the Tax Assessment
The demand notice follows an assessment under section 143(3), which identifies several areas of dispute. These include:
- Transfer Pricing (TP) additions: ₹88.84 crore
- Provision for doubtful debts: ₹329.48 crore
- Payment to unregistered GST entities: ₹565.01 crore
- Amortization of investment premium: ₹52.81 crore
- Disallowance of 14A expenses: ₹2.70 crore
Management Response and Next Steps
Despite the significant figure mentioned in the notice, the Corporation has clarified that there is no material impact on its current business operations or financial standing. The company is actively working with its direct tax consultants to prepare a formal appeal. This challenge will be filed before the National Faceless Appeal Centre (NFAC) within the statutory period of 30 days to contest the additions made by the tax authorities.
Source: BSE
