UPDATE ON ONGOING LITIGATIONS
Awaiting price reaction for this filing.
Ramco Cements has received favourable orders from the Income Tax Appellate Tribunal (ITAT) dated 17 April 2025, received on 2 May 2025, on two long-pending income tax disputes. Under Point (e), the ITAT dismissed the Income Tax Department's appeals for assessment years 2011-12 (Rs. 7.35 crore) and 2015-16 (Rs. 0.48 crore), where the department had reclassified certain revenue expenditure as capital expenditure. Under Point (f), the ITAT also dismissed the department's appeals on the Industrial Promotion Assistance matter for AY 2015-16 (Rs. 17.34 crore) and AY 2011-12 (Rs. 3.76 crore), confirming that the assistance should be treated as a capital receipt, not taxable income. With this ruling, the entire contingent liability of about Rs. 21 crore under Point (f) stands fully cleared. Similar disputes under Point (e) of about Rs. 11.88 crore remain pending with other statutory authorities.
Positive for shareholders — a combined ~Rs. 29 crore of contingent tax liability is now either removed or substantially reduced, lowering earnings risk and removing a long-standing overhang. The remaining ~Rs. 11.88 crore exposure is small relative to the company's size and unlikely to materially move the stock.