Hindustan Zinc Receives ₹73.46 Lakh GST Penalty Order Over CENVAT Credit on Cement Used
Hindustan Zinc received a Rs. 73.46 lakh GST penalty order from CGST Udaipur over CENVAT credit claimed on cement used in mines and plans to appeal.
Hindustan Zinc Limited has reported that it has received a demand order from the Goods and Services Tax authorities concerning a dispute over the use of CENVAT credit. The order has been issued by the Office of the Commissioner, Central Goods and Services Tax, Udaipur.
According to the company’s disclosure, the order confirms a penalty of Rs. 73.46 lakh along with a demand for tax and applicable interest. The issue relates to the reversal of CENVAT credit that the company had claimed on cement used as an input in its mining operations.
The dispute covers the period between July 2016 and June 2017, which falls under the earlier indirect tax regime before the full implementation of GST.
The order dated October 1, 2025, was received by the company on October 4, 2025. The tax authorities have stated that the credit taken on cement used in mines was not eligible under the provisions of the excise law.
Hindustan Zinc has stated that it believes it has a strong case based on the facts and the legal position. The company intends to challenge the order by filing an appeal before the Appellate Authority within the time limit allowed under the relevant law.
It has also clarified that it expects a favorable outcome and does not foresee any significant financial impact from the order on its business or operations.
Tax disputes of this nature are not uncommon in the mining and manufacturing sectors, as the classification of inputs and their eligibility for credit has often been subject to interpretation under the earlier tax framework. The company’s decision to appeal indicates that it will pursue all available legal remedies to resolve the matter.
About Company
Hindustan Zinc Limited is one of India’s largest producers of zinc, lead, and silver. The company operates under the Vedanta Group and has mining and smelting operations in Rajasthan. It is a major contributor to India’s base metal production and is known for its focus on sustainability and operational efficiency.
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