Star Health and Allied Insurance Company Ltd disclosed on Thursday that it is facing a tax demand of ₹170 crore, coupled with a penalty of ₹8.7 crore for non-payment of GST ( Goods and Services Tax ). The demand notice, issued under Section 73 of the Central GST Act, 2017, on February 14, 2024, originates from the Office of the Deputy Commissioner of the Large Taxpayers Unit in Chennai.
The demand specifically relates to the non-payment of GST liability concerning re-insurance commission received by Star Health and Allied Insurance Company during the period from April 2018 to March 2019, as per the details in the stock exchange filing.
In response, Star Health stated that it will file an appropriate response or appeal within the stipulated timelines based on the guidance of its tax advisors. Despite the company’s belief in the strength of its case against the demand, interest, and penalty, the ultimate outcome and financial implications remain uncertain at this point, as per the communication to the stock exchanges.
Star Health recently reported a robust financial performance, with a 37.6% YoY increase in net profit to ₹289.6 crore in Q3FY24, ending December 31, 2023. The gross written premium for the same quarter surged by 16.4% to ₹3,605.8 crore, while the net premium saw a 7.1% jump to ₹3,151.9 crore, compared to the corresponding period the previous year, showcasing the company’s resilience amidst the ongoing challenges.
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