Artemis Medicare Services Faces Rs 11.11 Crore Tax Notice

The GST department has issued a demand notice of Rs 11.11 crore to Artemis Medicare Services for the fiscal year 2022-23. This amount excludes additional interest and penalties that may accrue depending on the outcome.

Reader Takeaway: The company is contesting the tax claim in High Court, leveraging a previous legal stay order.

What just happened

The Office of the Assistant Commissioner, CGST, Gurugram, issued a show cause notice to Artemis Medicare Services alleging that the hospital collected GST on medicines and consumables for in-patients but failed to remit it to the government. The department contends that these charges were recovered from patients as part of the Maximum Retail Price (MRP).

Why this matters

This regulatory development introduces a potential financial liability of Rs 11.11 crore plus interest and penalties. For investors, this creates uncertainty regarding the company's tax treatment of hospital supplies, a sector-wide issue currently under legal scrutiny.

What changes now

Artemis Medicare Services is moving to file a writ petition before the High Court of Punjab & Haryana. The company intends to link this case to a similar pending matter for which it previously secured a stay order. The hospital management maintains that it is proactively defending its tax position through the judiciary.

Risks to watch

The primary risk remains the potential for an adverse court ruling, which could lead to cash outflows beyond the initial Rs 11.11 crore demand. The company’s financial provisioning will depend on the progress of these legal proceedings.

What to track next

Investors should monitor the High Court's response to the upcoming writ petition and specifically whether the court grants an interim stay of proceedings to block the tax department's recovery efforts.