Carraro India Limited has received a significant favourable ruling from customs authorities, obtaining complete relief from a substantial tax demand of ₹7,92,36,269. The company announced this development through a regulatory filing under Regulation 30 of SEBI Listing Regulations.

Customs Order Details

The favourable order was issued by the Office of the Commissioner of Customs, Pune, bearing order number PUNE-CUSTOMS-000-COMMR-02/2025-26 dated 13th March, 2026. The company received this order on 14th March, 2026 via email at 16:43 p.m.

Background and Resolution

The favourable order stems from a show cause notice dated 2nd September, 2025, which was filed with stock exchanges on 3rd September, 2025. The notice pertained to allegations of short levy of Integrated Goods and Services Tax (IGST) at 10%.

Following comprehensive submissions and representations made by Carraro India Limited before the tax authorities, the customs department has dropped the tax demand entirely. This resolution demonstrates the company's successful defence of its position regarding the IGST levy matter.

Financial Impact

The customs order will have a positive financial impact on Carraro India Limited's books. The complete relief from the tax demand will result in a reduction of the company's contingent liability by ₹7,92,36,269. This significant amount was previously recorded as a potential financial obligation that could have affected the company's financial position.

Regulatory Compliance

The company has fulfilled its disclosure obligations under Regulation 30 read with Clause 8 of Para B of Part A of Schedule III of SEBI Listing Obligations and Disclosure Requirements Regulations, 2015. The announcement was signed by Mohith Kumar Khandelwal, Company Secretary and Compliance Officer, ensuring proper regulatory compliance and transparency with stakeholders.

This favourable outcome eliminates a significant contingent liability from Carraro India Limited's financial obligations, providing the company with enhanced financial flexibility and removing uncertainty related to this customs matter.

Carraro India Limited has informed stock exchanges about receiving a draft assessment order from the Income Tax Department with revised tax adjustment proposals. The development follows an initial show cause notice received earlier in February 2026.

Draft Assessment Order Details

The company received the draft assessment order dated March 3, 2026, via email on March 9, 2026, at 4:15 p.m. IST from the faceless assessment unit of the Income Tax Department. This order was issued under Section 144C(1) of the Income Tax Act, 1961, following the company's detailed responses to an initial show cause notice dated February 12, 2026.

Proposed Tax Adjustments

The draft assessment order proposes tax adjustments that have been settled downwards compared to the initial show cause notice. The Income Tax Department has cited variations to be made to the company's total income across two main categories.

The transfer pricing assessment pertains to an order dated January 22, 2026, while the corporate tax adjustments represent a significant reduction from the Rs. 27.63 crore proposed in the initial show cause notice.

Company's Response Strategy

Carraro India plans to file its intimation with the faceless assessment unit, informing them about the forum where the company will contest the proposed tax adjustments. The company will make this filing within prescribed timelines based on legal advice received.

The company has expressed confidence in receiving favorable relief from the appropriate forum where these tax adjustments will be appealed. Management emphasized that there is no immediate impact on the company's financial operations or other activities due to this draft assessment order.

Regulatory Compliance

The disclosure was made in compliance with Regulation 30 read with Para A of Part A of Schedule III of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company provided detailed information as required under the SEBI Master Circular dated November 11, 2024, ensuring full transparency with stakeholders regarding this regulatory development.