The Goods and Services Tax wing of the Central Board of Indirect Taxes and Customs (CBIC) has carried out tax searches and inspections against a number of insurance companies. The listing of companies the tax sleuths have visited contains a number of of the foremost life and non-life insurers.
A authorities supply stated the tax searches have been about instances the place the insurance companies had taken enter tax credit score in extra of what they’re entitled to. This isn’t the primary time that the CBIC has launched a coordinated motion against a number of companies within the sector.
Some years in the past, the oblique tax division had investigated the non-life companies for alleged tax evasion within the motor insurance business. The mixed dues had then amounted to over Rs 1,500 crore.
This time the quantum of the overdrawal of enter tax credit score continues to be being added up, however it’s anticipated to be over Rs 3,000 crore for your complete trade. The mixed demand by the division from the insurance arms of one of the monetary sector entities is itself near Rs 600 crore, it’s understood.
Business Standard reached out through e mail and cellphone calls to a number of companies to elicit their response to the searches. None of them have been keen to touch upon the federal government motion, which has been on since early this week.
A high supply within the Insurance Regulatory and Development Authority of India confirmed the extent of motion by the CBIC.
However, the supply stated the regulator had not been knowledgeable formally by the finance ministry. Some of the companies are in favour of collective motion by roping within the General Insurance Council and the Life Insurance Council to supply a collective response to the GST wing of CBIC.
Interestingly, whereas some of the companies or their promoter companies are listed within the inventory exchanges, none has to date apprised the shareholders of the motion by the CBIC.
Over the previous couple of years, the federal government has been taking a sequence of steps to make sure there are not any leakages within the GST revenues. Both the direct and oblique tax departments have been pooling their data to make sure the tax dues are realised.
In August 2022, the gross GST income collected reached Rs 1.43 trillion, which is 28 per cent extra year-on-year. For the previous six months in a row, the month-to-month GST revenues have crossed the Rs 1.4 trillion mark.
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