Big Relief for Retired Bank Staff! Court orders Govt not to levy GST on health insurance
In a big relief for retired bank employees, the Kerala High Court has passed an interim order directing the Central Government and other authorities not to levy GST on group health insurance premiums paid by retired employees of Union Bank of India for the policy year 2025–26.
The interim order was passed on January 19 by a Division Bench comprising Justice V.G. Arun and Justice Harisankar V. Menon. The Court was hearing a batch of writ appeals filed by retired bank employees who had challenged an earlier ruling of a Single Judge. That earlier judgment had held that GST exemption on health insurance applies only to individual policies and not to group health insurance schemes.
During the hearing, the High Court admitted the appeals and scheduled them for further consideration on February 23. Till then, the Court ordered that no GST should be charged on the insurance premium paid by the petitioners, similarly placed retirees, or family pensioners of Union Bank of India. The Court issued this direction after the appellants assured that they would pay the GST amount if the final decision goes against them. Similar interim protection was granted in other connected appeals as well.
The appeals were filed by retired employees of different banks and members covered under group health insurance policies. They approached the High Court after their earlier writ petitions were dismissed by the Single Judge.
The retired employees argued that since GST on individual health insurance policies was waived from September 22, the same benefit should also be extended to group health insurance policies. They claimed that denying GST exemption to group policies while allowing it for individual policies is unfair and discriminatory.
The interim order has brought temporary relief to thousands of retired bank employees, who were facing a higher financial burden due to GST on group health insurance premiums. The final decision of the High Court is now awaited.
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