Tata Steel Faces ₹890 Cr GST Notice for Alleged Tax Credit Irregularities

Tata Steel has received a demand-cum-show cause notice from the Central Goods and Services Tax (CGST) and Central Excise Department, Jamshedpur, which is related to the alleged irregularities in claiming Input Tax Credit (ITC) amounting to ₹890.52 crore during the financial years from 2018-19 to 2020-21.

Dated June 13 and received by the company on Wednesday, the notice alleges wrongful availing of tax credits and demands recovery of the amount. It also seeks to impose interest and penalties. Tata Steel has been asked to appear before the Additional/Joint Commissioner of CGST & Central Excise in Jamshedpur within 30 days to explain its position.

In a regulatory filing, Tata Steel responded that the notice is meritless. The company said that it would submit the case to the adjudicating authority within the specified time. “We believe there is no merit in the allegations and will present our position accordingly,” the statement said.

The company underscored that this notice does not have any current impact on its financial or operating performance. In the words of the company, “There is no impact on the financials or operations of the company due to the issuance of the show cause notice.”

This adds to an increasing number of tax scrutiny cases in India’s industrial sector, where authorities are tightening compliance checks around GST credits-a prime area for tax leakages.

Pending the adjudication process outcome, Tata Steel’s hard line, by all indications, shows that it will oppose the charge stridently. The company indicated it would cooperate and be willing to fulfill all of the procedures mandated by law concerning taxation.

This now moves to the hearing stage, wherein Tata Steel will argue before the tax authorities.