Update on receipt of Demand Order under GST.
RAJPALAYAM · price
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Awaiting price reaction for this filing.
Rajapalayam Mills has received two GST demand orders from the State Tax Officer (Intelligence Wing) under Section 74 of the TNGST/CGST Act, 2017. The first order relates to FY 2020-21 with a demand of Rs. 4.75 crores, and the second relates to FY 2021-22 with a demand of Rs. 18.95 crores, taking the total demand to Rs. 23.70 crores. The issues flagged include ITC reversal on credit notes, interest on belated payment to creditors, tax on corporate guarantees, additions/deletions to fixed assets, tax on rent paid, and tax on other selling expenses. The company has stated that, based on its preliminary assessment, it believes it has a strong case and plans to appeal for a favourable outcome at the appellate stage.
The total demand of Rs. 23.70 crores is a material amount that could affect financials if the appeals fail, but since the company intends to contest and is confident of a favourable outcome, the immediate impact on share price may be limited. Investors should watch for updates on the appeal outcome.