New Delhi: Tata Steel announced on Sunday that it has received a show cause-cum-demand notice from tax authorities regarding the alleged irregular availment of input tax credit (ITC) exceeding Rs. 1,000 crore for the financial years 2018-19 to 2022-23.
The notice, issued by the Office of the Commissioner (Audit), Central Tax, Ranchi, on June 27, requires the company to justify within 30 days why Rs. 1,007.54 crore in GST should not be demanded and recovered.
This action follows an audit identifying potential violations of Section 74(1) of the Central Goods and Services Tax Act, 2017, along with related provisions under the State and Integrated GST Acts.
Tata Steel clarified in its stock exchange filing that it has already paid Rs. 514.19 crore in GST as part of its routine business operations.
“The proposed GST exposure, after appropriating this amount, stands at Rs. 493.35 crore,” the company stated.
The steel major asserted that the allegations are without merit and confirmed its intention to present its case before the relevant authorities within the stipulated time frame.
It also reassured stakeholders that the notice would have no impact on its financial, operational, or other activities.
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Under GST regulations, businesses can claim ITC on taxes paid for inputs used in producing goods or services.
These credits are applied as deductions against tax liabilities. However, discrepancies or non-compliance in ITC claims can attract penalties or recovery actions by tax authorities.
Tata Steel emphasised its commitment to complying with regulatory requirements and expressed confidence in resolving the matter in its favour.
