Mumbai, Nov 28 Mukesh Ambani-led Reliance Industries said on Friday that it has received a penalty order of Rs 56.44 crore from the Joint Commissioner of CGST in Ahmedabad.
The order, dated November 25, states that the company’s input tax credit should be treated as blocked credit. Reliance, however, said the order was issued without considering how the service provider had classified the services.
"The Company has received an order dated November 25, (“Order”) from the Joint Commissioner, CGST, Ahmedabad imposing on the Company a penalty of Rs 56.44 crore under Section 74 of the Central Goods and Services Tax Act, 2017, the Gujarat Goods and Services Tax, 2017 read with applicable provisions of the Integrated Goods and Services Act, 2017," reliance Industries said in its exchange filing.
The company informed the stock exchanges that it received the order by email on November 27 at 11:04 am and plans to appeal against the decision. The penalty has been imposed under Section 74 of both the Central Goods and Services Tax Act, 2017, and the Gujarat Goods and Services Tax Act, 2017.
"The Order has been passed interpreting input tax credit falling under blocked credit ignoring classification of services by service provider. The Company intends to file an appeal against the Order," it added.
Reliance added that the financial impact is limited to the amount of the penalty and that the order does not affect its operations or other business activities.
"The financial impact of the Order is to the extent of the penalty levied. There is no impact on operations or other activities of the Company due to the Order," the Mukesh-Ambani owned firm added in its regulatory filing.
Reliance shares, which have been rising recently and touched a new 52-week high, opened slightly lower in early trade on Friday but quickly recovered. The stock was trading 0.12 per cent higher at Rs 1,565.50 on the BSE Sensex shortly after the market opened.
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