HDFC Life Insurance Company has received an Income Tax Order demanding a tax payment of ₹126.46 crore for the assessment year 2023-24. The order, issued by the Assistant Commissioner of Income Tax, Central Circle 6 (2), Mumbai, was received on 23 March 2026. Additionally, the order includes an interest charge of ₹45.55 crore, while no penalty has been imposed.
The tax order alleges several discrepancies in HDFC Life’s financial reporting. Key allegations include the classification of shareholders’ net investment income as ‘Income from life insurance business’ rather than ‘Income from other sources’, and the incorrect claiming of certain incomes as exempt under Section 10. Further issues involve the deduction of contributions from shareholders in computing shareholders’ profits and the omission of proportionate disallowance as per Section 14A read with Rule 8D.
Moreover, the order questions the admissibility of certain marketing and advertising expenses in the financials, which were considered as allowable expenses in the taxable surplus calculation in the policyholder’s account.
HDFC Life has stated that the order will not have any adverse material impact on its financial operations. The company plans to contest the order by filing an appeal with the Appellate Authority within the specified period.
The major issues raised in the current assessment order have been previously covered by orders from the Income Tax Appellate Tribunal, Mumbai, and the Commissioner of Income Tax (Appeals) in HDFC Life’s own cases for earlier years. These issues were disclosed in the company’s pending litigations and disputes disclosures on 14 August 2023 and 9 November 2023.
Disclaimer: This article is based on a regulatory filing submitted to the National Stock Exchange of India (NSE).