Bajaj Allianz gets Rs 1,010 crore demand notice from GST Intelligence

The Directorate General of GST Intelligence, Pune zonal unit, has issued a show cause and demand notice to Bajaj Allianz General Insurance, according to financial services company Bajaj Finserv Ltd., which announced this on Tuesday, October 3.

According to a stock exchange filing, the agency issued a show cause cum demand notice on September 29, 2023, alleging a tax demand of Rs 1,010 crore.

The number of insurers encountering tax-related difficulties is growing, with Bajaj Allianz General Insurance becoming the fifth to receive a sizable GST demand.

The notice's claims are in relation to the time frame of July 2017 through March 2022. They revolve around two primary issues: non-payment of GST on co-insurance premiums accepted as followers in the case of coinsurance transactions, and non-payment of GST on reinsurance commission received for the reinsurance premium ceded to various Indian and foreign reinsurance companies.

According to Bajaj Allianz General Insurance, these concerns affect the entire sector. As a result, the company plans to reply to the show cause and demand notices in a timely manner after consulting with its tax consultants.