Aditya Birla Capital Limited has informed the Exchange regarding 'the update on tax litigation of subsidiary company'.
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Aditya Birla Sun Life Insurance Company Limited (ABSLI), a subsidiary of Aditya Birla Capital, has filed an appeal with the Commissioner (Appeals) against a GST order passed by the adjudicating authority. The order relates to claiming of input tax credit on certain services availed during July 2017 to August 2022. The tax demand is Rs. 87.53 crore with interest as applicable and a penalty of Rs. 87.53 crore, totaling a potential exposure of around Rs. 175 crore plus interest. The appeal has been filed within the mandated timelines. The matter is currently under litigation and no settlement has been reached.
The combined tax demand and penalty of approximately Rs. 175 crore is a material contingent liability for the subsidiary, but since the company is actively contesting it through appeal, the immediate financial impact is limited. Investors should monitor the appeal outcome as an adverse ruling could affect the subsidiary's earnings and overall group financials.