News date: 16 November 2022

Key Pointers:

• Under pressure in the ‘GST evasion’ issue, the insurance industry has approached the government to sort out the issue without burning its fingers.
• These insurance companies have availed input tax credit on the basis of invoices issued by several intermediaries for providing services like advertising, marketing and brand activation whereas no such services had actually been provided.
• The government had said Directorate General of GST Intelligence, Mumbai Zonal Unit initiated investigations against 16 insurance companies on the issue of availment of ineligible input tax credit.
• Investigations by the unit revealed that input tax credit of Rs 824 crore has been availed, out of which an amount of Rs 217 crore has been paid voluntarily by these 16 insurance companies so far, a statement from the government said.
• Sources said he also assured that there wouldn’t be any coercive actions against general insurers including arrest or summoning of CEOs of the companies by the GST enforcing authorities.
• On hearing the pleadings of the CEOs, a top government official said, “normally, the insurance industry has remained law abiding. All the aspects of allegations will be looked into. If the insurers have made any payment to any institutions, it will be excluded from the purview of the investigation by the GST authorities.’