CHIL's Tax Bill Halved by ₹86.66 Cr After IT Dept Correction

Care Health Insurance Limited (CHIL), a subsidiary of Religare Enterprises, had its tax demand for Assessment Year 2022-23 cut by ₹86.66 Crores. The Income-Tax Department issued a rectification order correcting a technical error, lowering CHIL's tax liability from ₹173.32 Crores to ₹86.66 Crores.

IT Department Issues Rectification Order

Religare Enterprises disclosed that its subsidiary, Care Health Insurance Limited (CHIL), received a Rectification Order from the Income-Tax Department on April 28, 2026. The order corrects a technical issue in the tax demand for Assessment Year (AY) 2022-23. This means CHIL's net tax liability for AY 2022-23 is now ₹86.66 Crores, a reduction of ₹86.66 Crores from the earlier ₹173.32 Crores. CHIL and Religare Enterprises were informed of this order on April 29, 2026. The original tax demand was first disclosed on September 28, 2024.

Financial Impact

Lowering CHIL's immediate tax obligations offers a direct financial benefit. Because CHIL's financial results are included in Religare Enterprises' consolidated statements, this reduced tax liability helps the group's overall profitability and financial health.

Previous Tax Matters and Current Appeal

Care Health Insurance is a significant health insurer in India and a key part of Religare Enterprises. CHIL has faced previous tax notices. In March 2025, it received a demand for ₹104.77 Crores for Assessment Years 2020-21 and 2021-22. In March 2026, CHIL received income tax assessment orders totaling ₹140.20 Crores for AY 2023-24 and 2024-25, which the company plans to contest. Crucially, CHIL still has a pending appeal concerning other additions made in the Assessment Year 2022-23 order, separate from the technical error that was just rectified.

Key Changes

• CHIL's tax payments for AY 2022-23 are now halved.
• Religare Enterprises' consolidated profit figures will show a positive adjustment.
• This lower tax obligation helps with the company's financial planning and cash flow.

Remaining Risk

The main risk continues to be the outcome of CHIL's pending appeal against other additions within the Assessment Year 2022-23 order. This appeal is currently with the relevant authority.

Market Context

CHIL is a major standalone health insurer in India, facing competition from companies like HDFC Ergo, Star Health, Niva Bupa, and ICICI Lombard. Tax demands and regulatory scrutiny are not uncommon in the sector, with many companies facing increased compliance expectations.

Looking Ahead

Investors will watch the outcome of CHIL's pending appeal on other additions for Assessment Year 2022-23. Updates from the Income-Tax Department or CHIL on other tax matters will also be monitored. Religare Enterprises' consolidated financial reports will reflect this tax adjustment. CHIL's operational performance and premium growth in the competitive health insurance market remain key focus areas.