Life Insurance Corporation of India (LIC), the country's largest insurer, on Friday (September 22) said the company has received an order from the Bihar Additional Commissioner State Tax (Appeal), Central Division, Patna, demanding Rs 290.50 crore GST.

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This order, issued under Section 73(9) of both the Bihar Goods and Services Tax (BGST) and Central Goods and Services Tax (CGST) Act 2017, entails the demand for GST payments, coupled with interest and penalties, according to a stock exchange filing.

"In the said order, the authority has demanded goods and service tax along with interest and penalty. The corporation shall file an appeal before the GST Appellate Tribunal and against the said order within prescribed timelines," the company said.

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Specifically, the authorities have raised concerns regarding the ITC (input tax credit) availed and used by LIC on items deemed non-leviable to GST. One aspect of the dispute centres on the premium received by the corporation from policyholders, where a portion appears to be categorised as non-GST-liable.

The second area of contention relates to the ITC associated with the commission paid to agents. This commission encompasses not only the portion linked to the non-GST-leviable premium but also extends to policies that fall under the category of Exempted from GST.

It plans to file an appeal before the GST Appellate Tribunal within the prescribed timelines, seeking a resolution to the matter through legal recourse.

Also Read: LIC chairperson says pressure in the last quarter of FY23 dragged next quarter’s earnings

Shares of Life Insurance Corporation of India ended at Rs 651.20, down by Rs 3.35, or 0.51 percent on the BSE.

(Edited by : Shoma Bhattacharjee)