ICICI Prudential Life Insurance Co. said that it received an income tax order worth Rs 361 crore, including interest from authorities in Mumbai. The demand relates to the assessment year 2022–23, according to an exchange filing.
The demand includes Rs 275 crore in tax and Rs 85 crore in interest. It relates to negative reserves considered as part of taxable surplus, transfers from shareholders accounts to policyholders accounts considered as income, and exemptions in respect of certain incomes not allowed.
Moreover, certain marketing and advertising expenses considered inadmissible and hence disallowed while calculating the taxable surplus in the policyholder's account have also been flagged.
The private insurer has said that it will file an appeal against the order before the appellate authorities within the prescribed timelines. The tax demand was raised by the Assistant Commissioner of Income Tax, Mumbai.
Shares of ICICI Prudential closed 0.85% higher at Rs 789.75 apiece on Friday, ahead of the announcement, compared to a 0.3% decline in the benchmark Sensex.
Nineteen out of the 33 analysts tracking ICICI Prudential have a "buy" rating on the stock, 11 recommend a "hold," and three suggest a "sell," according to Bloomberg data. The average 12-month analyst price target of Rs 741 implies a potential downside of 6%.
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