Eicher Motors Limited, a well-known automobile company, has received tax demand orders from the Goods and Services Tax ( GST ) authorities. The total demand is Rs. 12.8 crore, which includes both tax dues and penalties. The demand was raised due to mismatches in Input Tax Credit (ITC) claims and issues related to transitional credit.
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The demand orders have been issued by three different GST offices:
1. Jaipur Office: The Assistant Commissioner of CGST, Jaipur has asked Eicher Motors to pay Rs. 0.62 crore. This amount includes a tax demand of Rs. 0.31 crore and a penalty of Rs. 0.31 crore. The reason for this demand is that the authorities have identified certain blocked credits claimed by the company between 2017-18 and 2021-22.
2. Lucknow Office: The Principal Commissioner, CGST & Central Excise, Lucknow, has issued a much larger demand of Rs. 6.64 crore. This includes a tax demand of Rs. 3.32 crore and a penalty of Rs. 3.32 crore. The tax officials claim that Eicher Motors wrongly availed transitional credit in July 2017, during the switch from the old tax system to the GST system.
3. Delhi Office: The Additional Commissioner, CGST, Delhi South Commissionerate, has raised a demand of Rs. 5.54 crore, which includes Rs. 2.73 crore in tax and Rs. 2.81 crore in penalties. The authorities claim that between 2017-18 and 2020-21, the ITC the company claimed in its GSTR-3B returns differed from the data reported by its suppliers in GSTR-2A.
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Eicher Motors has responded to these notices and stated that it believes these demands are not justified. In its filing to the stock exchange, the company mentioned that it is evaluating legal options and may file an appeal against the orders.
The company stated: “Based on our assessment, the demand is not maintainable. We are currently reviewing all options, including filing an appeal against the order.”
If the company successfully proves that its ITC claims are correct, the demand may be reversed but if the authorities uphold the order, Eicher Motors will have to pay the full amount, including penalties.
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