Max Healthcare Unit Receives ₹166 Crore GST Notice Over Management Fees
Key Takeaways
- •Alps Hospital, a Max Healthcare subsidiary, was served a GST notice by the DGGI over alleged unpaid tax on variable management fees.
- •The total tax demand plus proposed penalties amounts to approximately ₹165.7 crore, excluding applicable interest.
- •The notice concerns management fees paid within the corporate group, despite hospital healthcare services being largely GST-exempt in India.
- •Tax authorities have increasingly examined whether such inter-company fees attract GST, making hospital chain arrangements a recurring area of scrutiny.
A subsidiary of Max Healthcare, Alps Hospital, has been served a Goods and Services Tax (GST) notice by the Directorate General of GST Intelligence (DGGI) over alleged non-payment of tax on variable management fees.
According to the notice, the total tax demand, together with proposed penalties, amounts to approximately ₹165.7 crore. This figure excludes any applicable interest.
GST is India's indirect tax regime, and the DGGI is the agency responsible for investigating tax evasion and intelligence related to GST compliance. Show-cause notices of this kind typically require the recipient to respond with an explanation of the alleged discrepancy.
The dispute centres on management fees paid within a corporate group. While healthcare services by hospitals are largely exempt from GST in India, tax authorities have in recent years examined whether fees such as those at issue here attract the tax, making inter-company arrangements within hospital chains a recurring area of GST scrutiny for the sector.
Source: CNBC-TV18
