Last Updated:June 27, 2025, 15:09 IST
The Rs 2,298 crore GST notice, issued on June 26, 2025, covers the period from April 2018 to March 2023 and falls under Sections 74 and 123 of the CGST Act, 2017
GST officials have accused the company of tax non-payment, underpayment, wrongful refunds, or misuse of input tax credit. (Representative/Shutterstock)
India’s largest general insurance company, New India Assurance Company Limited, has received a Goods and Services Tax (GST) demand notice amounting to Rs 2,298 crore from the Additional Commissioner’s Office of Mumbai-South.
The company said on Thursday that tax authorities have issued a show cause notice seeking GST dues for five financial years.
The notice, issued on June 26, 2025, calls on New India Assurance to explain why the alleged GST liability of Rs 2,298,06,74,252 for the period from April 2018 to March 2023 should not be recovered from the company. It has been issued under Sections 74 and 123 of the Central Goods and Services Tax (CGST) Act, 2017.
According to New India Assurance, this notice will not impact its financial, operational, or other activities, and the company plans to respond robustly. GST officials have accused the company of tax non-payment, underpayment, wrongful refunds, or misuse of input tax credit (ITC). The demand is based on allegations of fraud, deliberate misrepresentation, or concealment of facts.
Section 74 deals with cases of non-payment or tax misuse due to fraud or deliberate misrepresentation, while Section 123 concerns the non-filing or delayed filing of returns. This notice may relate to broader issues within the insurance industry, as New India Assurance previously received a GST notice for Rs 2,379 crore in 2023. At the time, the issue centered around non-payment of GST on co-insurance premiums and tax on re-insurance commissions, where the lead insurer had paid 100% GST on behalf of the follower insurer.
How Did The Company Respond?
In response, New India Assurance informed the stock exchange that it will address the GST notice promptly and is confident of having strong grounds. The company stated that the notice will have no impact on its business operations or financial position.
According to a PTI report, the company further said in a regulatory filing that, based on advice from its tax consultants, it is preparing a detailed reply outlining its contentions, which will be submitted to the Adjudicating Authority within the prescribed timeline.
Pressure On Insurance Industry
This notice is part of increased scrutiny by GST authorities on the insurance sector, with several other insurance companies receiving similar notices in recent years.
- Bajaj Allianz General Insurance: Received a notice for Rs 1,010 crore
- HDFC Life: Received a notice for Rs 942 crore
- ICICI Prudential Life: Received a notice for Rs 492 crore
- ICICI Lombard: Received a notice for Rs 1,729 crore
- LIC: Received a notice for Rs 290 crore
The total value of these notices amounts to approximately Rs 5,832 crore, highlighting the growing regulatory focus on GST compliance in the insurance industry. Experts suggest that technical complexities in co-insurance and re-insurance transactions could be driving these demands.
Inside New India Assurance
Founded in 1919, New India Assurance is India’s largest general insurance company, with a network of over 1,900 offices and a presence in 25 countries. It has an authorised capital of Rs 1,000 crore and a paid-up capital of Rs 824 crore. In FY25, the company’s gross written premium (GWP) stood at Rs 43,618 crore, marking a 3.86% increase from Rs 41,996 crore in FY24.
However, its net profit declined by 2.06% to Rs 346.63 crore in Q4 FY25, and the full-year net profit dropped by 12.86% to Rs 988 crore, primarily due to a provision of Rs 802 crore for old non-performing re-insurance balances.
How Did Market React
Following the news of the notice on 26 June, New India Assurance’s shares experienced a slight dip, trading 2.50% lower at Rs 185.50 on the NSE. Despite this, the company’s strong financial base and response strategy have maintained investor confidence.
- Location :
Delhi, India, India
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