L&T Faces ₹173.24 Crore GST Penalty, Plans Appeal
Infrastructure giant Larsen & Toubro (L&T) has been penalized ₹173.24 crore by the Joint Commissioner of CGST and Central Excise, Bhopal, for discrepancies in GST compliance over five assessment years, spanning 2017-18 to 2021-22.
Details of the Penalty
Amount: ₹173.24 crore
Reason:
Discrepancies between financial statements and GST returns.
Issues involving non-taxable transactions.
Disputes over input tax credit (ITC) claims and reversals.
Imposed Under: Section 122 of the Central Goods & Services Tax (CGST) Act, 2017.
L&T’s Response
Disagreement with Penalty:
The company asserts the penalty arises from technical discrepancies rather than tax evasion.
Explanations were provided to the tax authorities, but the penalty was still imposed.
Planned Action:
L&T will appeal the order with the appellate authority.
Confident of securing a favourable verdict, the company believes the dispute pertains to interpretation issues.
Impact on L&T
Financials:
L&T’s management has assured stakeholders that the penalty will not materially affect its operations or financial performance.
Operations:
Day-to-day business remains unaffected by the ongoing legal proceedings.
Conclusion
L&T’s decision to challenge the penalty underscores the complexities of GST compliance for large corporations. The case highlights the need for clarity in interpreting GST provisions to avoid disputes and penalties. The outcome of the appeal will serve as a key precedent for future GST-related disputes in the infrastructure sector.
