Chambal Fertilizers & Chemicals Limited has informed the Exchange about Action(s) taken or orders passed
CHAMBLFERT · price
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Awaiting price reaction for this filing.
Chambal Fertilizers has received an order from the Joint Commissioner of CGST & Central Excise, Patna-I, levying a penalty of about Rs. 526.85 crore (Rs. 5,26,84,73,848). The order, dated September 26, 2025, was passed under Section 74(9) of the Central GST/Bihar GST Act and relates to alleged GST liability on subsidies receivable from the Government of India on fertilizers, and alleged wrongful claim of input tax credit (ITC) for FY 2018-19 to FY 2022-23. The company states that under Section 15(2)(e) of the CGST Act, GOI subsidies are excluded from the value of taxable supply and therefore no GST is applicable. It also says there is no material impact on its financials or operations beyond the penalty amount, and that it has a strong case and will challenge the order at an appropriate appellate forum.
This is a significant tax demand (~Rs. 527 crore) that could weigh on sentiment, but since the company plans to appeal and the matter pertains to subsidies that are statutorily exempt, the final financial hit is uncertain. Investors should monitor the appellate outcome before pricing in any real impact on earnings or cash flows.