New Delhi, March 25: Life Insurance Corporation of India (LIC) on Wednesday disclosed that it has received a massive tax demand from the Income Tax Department for the financial year 2021–22, amounting to over ₹61,000 crore, along with additional interest liabilities.
In a regulatory filing, LIC stated that the Assessment Unit of the Income Tax Department has raised a demand of ₹61,46,71,18,015 as income tax, accompanied by an interest component of ₹9,53,25,87,935. The total demand thus runs into a substantial figure, making it one of the largest tax claims against the insurer in recent times.
The corporation clarified that it does not agree with the assessment and will challenge the order through legal means. LIC confirmed that it will file an appeal before the Commissioner of Income Tax (Appeals), seeking relief against the demand as per due process of law.
According to the filing, the tax demand has arisen due to several adjustments made by tax authorities during the assessment process. These include treating interim bonuses paid to policyholders as income, adding losses from the Jeevan Suraksha Fund to taxable income, and considering negative reserves as part of income.
Additionally, the department has disallowed certain deductions claimed by LIC under Section 80M of the Income Tax Act. Interest expenses related to delays in depositing tax deducted at source (TDS) have also been factored into the demand.
Despite the scale of the demand, LIC reassured stakeholders that the order is not expected to have any material impact on its overall operations or financial stability. The insurer emphasized that the financial implication is currently limited to the disputed tax and interest amounts.
The disclosure was made in compliance with Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, which mandates listed entities to report significant developments to stock exchanges.
LIC further confirmed that the information has been duly shared with stock exchanges and published on its official website. Following the announcement, LIC’s shares ended on a positive note, closing at ₹779.60 on the NSE, up ₹20.90 or 2.75 per cent, with another recorded closing at ₹781.10, reflecting a gain of ₹22.40 or 2.95 per cent.
